I currently have DropBox and it's installed on my Mac in the user folder. When I sync files it also takes up space on my computer's internal drive. Does iCloud Drive originally store my files on my Internal Drive before syncing or is it all in the cloud?
MacBook Pro, OS X Mavericks (10.9.4)
With Dropbox you can select which folders will be synced to your computer and which not. So you can limit the space, that Dropbox will use locally (Dropbox > Preferences > Accounts: Selective Sync)
That is not possible with iCloud. iCloud Drive will keep a local copy on your Mac for all files and folders you store on iCloud Drive, and this local copy is stored in the user library on your home folder, see: iCloud Drive FAQ
iCloud Drive looks like a regular external drive stored in iCloud in the Finder, but all documents are always updated across all devices and also stored locally on your Mac.
iCloud drive location
