First you’ll need to SSH to your server and perform all the following commands as root or via sudo:

$ su

Let cPanel set up Ruby and Rails the way it wants:

$ /scripts/installruby
$ /usr/local/cpanel/bin/ror_setup

Install passenger the normal way (see Passenger docs):

$ gem install passenger
$ passenger-install-apache2-module

Create /usr/local/apache/conf/passenger.conf with the lines that the Passenger install script tells you to add to your Apache configuration file, e.g.:
[apache22]
LoadModule passenger_module /usr/lib/ruby/gems/1.8/gems/passenger-2.2.11/ext/apache2/mod_passenger.so
PassengerRoot /usr/lib/ruby/gems/1.8/gems/passenger-2.2.11
PassengerRuby /usr/bin/ruby
[/apache22]

Include the Passenger config by editing /usr/local/apache/conf/httpd.conf and, somewhere near the beginning, adding:
[apache22 light="true"]Include "/usr/local/apache/conf/passenger.conf"[/apache22]

We want to make sure cPanel preserves our edits to httpd.conf when it does updates, so we need to run:

$ /usr/local/cpanel/bin/apache_conf_distiller --update --main

Restart Apache with

$ /scripts/restartsrv_httpd

Upload your Rails app to somewhere outside of public_html (e.g. ~/rails_apps/yourapp) or use cPanel’s “Software / Services > Ruby on Rails” functions to create a new one.

Login to your domain’s cPanel and go to “Domains > Subdomains”
Create a new subdomain whose document root is path/to/yourapp/public
Make sure it’s pointing to yourapp/public

Visit your subdomain and see your app running — easy!