I found out that somebody is sending e-mails with my domain name eg= xx@mydomain.com.. How could you stop them from doing that?

If you own that domain, and you bought it with a hosting account, then you should be able to view the email accounts valid for your domain. If it's not in there, than there is not really anything you are able to about it, other than contact them and ask them to switch, which will not work, imo.

the account is not in my host and they are using an e-mail name that I have. If I send an e-mail to that address it comes to me. I wish there was a way to solve that problem and stop them from using my domain name..thanks

Check the email header for original address most mail application have such option you need only search for it. For example in Microsoft Outlook you need yo right click on received message and select Options, new windows opens and there you see info on Internet headers. Yahoo account select full header to read whole info, in Webmail open message click on Message Source and so on, by checking header you should be able to find original sender

People could be spoofing your address using the mail function in php as you can specify who the sending address is

It's quite possible they are not using your email address, rather some how masking it to appear that they are.

Kind regards

If they are spoofing your domain (most likely they are) you can't do anything about it.

When this happens, it usually occurs when you have a "catch all" E-mail address that recieves all E-mails that are sent to your domain but go to an invalid address. If you disable that feature, you won't have the problem anymore.

I had the same problem and this is how I solved it.

i think there is no solution to stop anybody to send mail with ur domain using php script and most of spam are generated like that

Well, since I disabled the catch all address, I haven't had the problem. I use Google Apps mail for my company's E-mail addresses. The method I used may have only have pertained to Gmail.