Since MySQL version 4.1, InnoDB has provided two options
      for how tables are stored on disk. You can choose to create a new
      table and its indexes in the shared system tablespace (corresponding to
      the set of files named ibdata files), along
      with other internal InnoDB system information. Or, you can chose
      to use a separate file (an .ibd file) to store
      a new table and its indexes.
The tablespace style used for new tables is determined by
      the setting of the configuration parameter
      innodb_file_per_table at the time a table is
      created. Previously, the only way to set this parameter was in
      the MySQL option file (my.cnf or
      my.ini), and changing it required shutting
      down and restarting the server.  Beginning with the
      InnoDB Plugin, the configuration parameter
      innodb_file_per_table is dynamic, and can be set
      ON or OFF using the
      SET GLOBAL command.  The default setting is
      OFF, so new tables and indexes are created in
      the system tablespace.  Dynamically changing the value of this
      parameter requires the SUPER privilege and
      immediately affects the operation of all connections.
Tables created when innodb_file_per_table is
      disabled cannot use the new compression capability, or use the new
      row format DYNAMIC. Tables created when
      innodb_file_per_table is enabled can use
      those new features, and each table and its indexes will be
      stored in a new .ibd file.
The ability to change the setting of
      innodb_file_per_table dynamically is useful for
      testing. As noted above, the parameter
      innodb_file_format is also dynamic, and must be
      set to “Barracuda” to create new compressed tables, or tables
      that use the new row format DYNAMIC. Since both
      parameters are dynamic, it is easy to experiment with these table
      formats and the downgrade procedure described in
      Chapter 11, Downgrading from the InnoDB Plugin without a system shutdown and
      restart.
Note that the InnoDB Plugin can add and drop a table’s secondary
      indexes without re-creating the table, but must recreate the table
      when you change the clustered (primary key) index (see
      Chapter 2, Fast Index Creation in the InnoDB Storage Engine).
      When a table is recreated as a result of creating or dropping an
      index, the table and its indexes will be stored in the shared system
      tablespace or in its own .ibd file just as if it were created using a
      CREATE TABLE command (and depending on the setting
      of innodb_file_per_table). When an index is created
      without rebuilding the table, the index is stored in the same file as
      the clustered index, regardless of the setting of
      innodb_file_per_table.
This is the User’s Guide for InnoDB Plugin 1.0.6 for MySQL 5.1, generated on March 4, 2010 (rev 673:680M).

