Sendmail error 67 user unknown

Hi

I recently installed and configured sendmail with a remote smtp (register.com's SMTP and mail server, which I purchased)

It works well and I can send emails to yahoo, AOL, MSN, Hotmail and... from PHP in my VPS.

But when I try to send an email to my own domain like:
test@mydomain.com

I get error:
sendmail error 67 (User unknown.)

Any ideas?

Thanks