Physical database design is the commitment of all the previous design stages to a physical reality.
Entities, attributes, and relationships are identified and normalized in previous phases of the design process. Attribute sets are assigned to domains.
The physical design phase identifies and creates the actual databases, base tables, constraints, indexes, partitioning, views, macros, triggers, and other objects that define the physical database that drives your data warehouse.
Much of physical design focuses on the performance aspects for the execution of queries using well-chosen indexes.
See Indexes and Maps through Designing for Missing Information for more information about physical database design.