While Zotero stores all research information locally on your computer by default, Zotero's sync functionality allows you to maintain one up to date Zotero library and access it on any computer with internet access.
Zotero syncing has two parts: data syncing and file syncing.
Everything in your collections, including items, notes, links, and tags, — everything except attachment files, will be saved to the Zotero server. There is no limit to the amount of data that can be synced with your free Zotero account.
With your Zotero account, you are given 300 MB of free Zotero File Storage to sync the attached files, with larger storage plans available for purchase. Other syncing options include using a WebDAV service (note group libraries cannot use WebDAV) or Linked File Attachments.
Rice has purchased an institutional file storage plan with Zotero, so you have unlimited Zotero storage to sync your attached files. This also means you can use Zotero file storage for Zotero groups.
The most important file in the data directory is the zotero.sqlite file, which is the database containing the majority of your data: item metadata, notes, tags, etc. The directory also contains a 'storage' subdirectory, containing all of your file attachments, such as PDFs, web snapshots, audio files, or any other files you have imported.