CSS rules can reside in the following locations:
External CSS style sheets are collections of CSS rules stored in a separate, external CSS (.css) file (not an HTML file). This file is linked to one or more pages in a website using a link in the head section of a document.
Internal (or embedded) CSS style sheets are collections of CSS rules included in a style tag in the head portion of an HTML document.
Inline styles are defined within specific instances of tags throughout an HTML document.
Dreamweaver recognizes styles defined in existing documents as long as they conform to CSS style guidelines.