Unable to set the Dropbox storage to an external drive on Mac OS Sequoia

Question

I am using a new Mac mini 4 and this is the first time I've not been able to have Dropbox use an external drive to store dropbox data. There is a pop-up above the (i) in the preferences for Sync that says that this version of Mac OS requires cloud storage to be in a specific place. BUT I don't want Cloud Storage. I want real data storage on my external hard drive. How can I set this. There is no option to change default storage.

Trying to drag the "Dropbox" folder to the external drive does not complete giving me an error that Dropbox needs to be installed - even though it is already installed in the Applications folder.

If this does not get fixed, I'm leaving Dropbox after 12 years.

dominguez855 · Accepted Answer

I don't know what File Provider is and I don't know why that was the default way to install Dropbox now on a Mac. In any case, the real culprit it seems is that Dropbox requires external drives to be formatted as APFS or HFS+. That would be great info to know. It's also weird that exFat is not supported like it used to be.

Solution: reformat external drive to APFS.