must I have room for all my Dropbox files on my iPad?

My main goal for (potentially) buying an ipad would be to read and markup pdf files (and web pages in pdf form). I currently have these stored on my desktop (imac), laptop (pc), and Dropbox.

Do I have to be sure that my iPad has enough storage space for my entire Dropbox collection? Or is there a way to edit files locally on the iPad, restore them to the cloud, and keep them off the iPad long-term? (On my laptop and desktop, all Dropbox files are stored locally.)

I don't need to have ALL my work files on my iPad, but I'd like to have access to them for editing. I worry about running out of space quickly (given other stuff I'll have on there, such as music).