In the ways that count, yes it does, but not in the way you're probably thinking.
Lightroom remembers where your master images were when you imported them, and it also keeps in its catalogue all of the changes that you made when you edited them. Thus, when you have need of a copy of your edited image for printing or posting to the web or emailing to a friend, you can export a copy that contains all your changes. Lightroom applies the changes to the original file and exports the result. Those copies can always be created on demand, but they aren't stored ahead of time.
Does LR keep a copy of my edited photos?
No objections to Hal's answer but here is another perspective:
To be clear: Lr does not "suck into itself" your original files - they remain on disk where-ever they were when imported, so DO NOT DELETE THEM OR MOVE THEM after they've been imported.
Lr saves edits as a list of settings in the Lightroom database (aka "catalog").
When exporting, Lr applies the edit settings to the original to create an edited copy (e.g. jpg file) - that copy can be added back to the catalog, or not - usually not, but it's your call.. If you do opt for adding back to catalog, then the same thing applies: don't delete it (outside of Lightroom I mean) from wherever it was exported, or Lr will no longer be able to find it..
Thank you for your response. I am learning bits and pieces as I go, so I've definately noted the DO NOT DELETE, which I'm sure will save me a lot of grief.
If I may, I have another question/scenerio that I need cleared up.
I spent a whole year scanning and saving all my pictures, every camera disk, flashdrive, even those I had in frames, to an external harddrive. I started this project because my friend lost every picture they had in a house fire. No sooner than I had finished, my home computer suffered from a lightening bolt and burnt to a crips. Luckily I had all my pics saved and stashed away on my external hard drive. For that reason, I do not want to save pictures on my home computer. I share that with you to help you understand why I use the external HD.
I have been practicing the import process and have imported everything I had on my X-HD to LR, so I can try some editing.
My question is this: Since all my pics are also in LR now, do I still export them back to the external hard drive?
To be clear: when you import a picture in Lr, it simply notes where the photo file is on disk (and generates a viewable version of it called a preview, but that preview is NOT the photo file itself), so your picture files are not in Lr, Lr just knows where they are on disk.
So, you need to back them up from wherever they are on disk, to a backup location on another disk, and to an offsite location too if you're worried about fire..
If you are not sure where a photo is on disk, you can context-click it (right-click in Windows, ctrl-click on Mac), and choose "show in Explorer/Finder" (there are other ways too).
Your edits are in the catalog, so back that up too.
Exporting simply make an edited copy - no need to back up exported files, just catalog and photos files. You can always recreate exported copies if you have the catalog and requisite photo files.
After you learn the ropes, you may also want to save/backup (xmp) metadata, but that's getting too far ahead now..
WOW! This information is priceless to a new student like me. Why doesnt Adobe just just say it this way. I can't thank you enough. You have taught me so much on importing. I have taken notes and tried it several times too to help me get a better understanding. Now I am moving on to Exporting!!