Local storage refers to the physical disks built into the HCI host. After installing the HCI, the disks, excluding the system disk, are added to the HCI storage pool. It is generally recommended to use virtual storage or external storage, as local storage has more limitations compared to virtual and external storage. The specific limitations are as follows:

1. Virtual machines on local storage cannot be HA.
2. Virtual machines on local storage cannot be scheduled by DRS.
3. After the physical node failure, other online physical nodes cannot restart virtual machines on the failed node.