What does Purgeable means in Storage under About This Mac section? I updated to macOS Sierra (16A319) and was checking my storage where I saw this extra division greyed out saying Purgeable.



What is the significance/meaning of Purgeable?
Purgeable is a distinct concept from the "Store infrequently used files on iCloud" functionality.  From Mac Help (available from the Help menu, search for "purgeable"):


  “purgeable space” — or space that macOS can free up when needed by  removing files from your computer. You can’t manually remove the files  that are designated purgeable, but macOS removes them as space is  required.


...


  "Purgeable: Contains locally stored files and documents that can be removed when space is needed, and then downloaded or generated again when the files are needed again by you or your Mac."


Effectively the OS has various caches, temp files, copies of things it downloaded, etc. that are being keeping around out of view of normal users, but they can be deleted if space is needed. 

If you turn on the optimized storage feature (that stores infrequently used files from Documents and Desktop folders to iCloud), they may or may not be counted with along with the system purgeable files.  But even without turning on that feature, there are other purgeable files present.