ArcGIS Desktop connects directly to CAD files. You manage them in a Catalog window as read-only CAD feature datasets while the source files remain on disk in their native format.
The contents are organized on the fly into a geodatabase-enforced schema and display as virtual CAD feature classes. When you add them to ArcMap, ArcScene, or ArcGlobe, all standard map functions are enabled, including attribute tables and labeling functions. You can snap to geometry, substitute symbology, and use them with any geoprocessing tool that accepts feature classes or layers as input.