What does Drupal use for caching? Is this something like APC or memcache? Where does it store cache files?
Out of the box, it's stored in the database, in a number of tables names
There are lots of other options if one wants to configure it differently.
- MongoDB A nice feature is that mongo supports replication across multiple databases
- Varnish Doesn't replace normal caching, but integrates with Varnish so Varnish can invalidate cache when Drupal does
- Boost Can generate static HTML files from content.
Also see Lullabots Beginners guide to caching data in drupal 7 (Thanks Chapabu!).
The basic drupal caching uses serialized data stored in database for caching.
If you want to have a look at the tables
SHOW TABLES LIKE 'cache_%'; to get a list of all the tables associated basic drupal caching.