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Difference in behavior for Registering My Domain and NameSpace

I was trying to follow to create Lightening Component. While I was trying to Preview the application, it was giving me error and was asking me to create My Domain. Before I go further, I want to know,

What is the difference in behavior between My Domain and Registering NameSpace? As with NameSpace, does My Domain will also override entire url for my developer force account? Or does this affect only for Lightening components?