Finding things in Finder · Storage Studio in Finder's sidebar
Why do files in the Storage Studio location show as online-only, and do they use space on my Mac?
Short answer: Files stay in the cloud until you open them, so online-only items take essentially no space on your Mac. Opening one downloads it on demand, so large files can take a moment the first time.
They stay in your cloud account until you open them, so a folder full of online-only files takes essentially no space on your Mac. When you open one, it downloads on demand — which is why the first open of a large file can take a moment, depending on your connection.
This works the same way as the online-only files you may know from iCloud Drive or Dropbox.
If you need files available without a connection, copy them to a folder on your Mac or your external drive.