A raw file is the unprocessed light data that was captured by your camera sensor. The only settings on your camera that apply to this file are aperture, shutter speed, and ISO. This means that any settings you may have applied to the file, such as white balance, or black and white effects, have no effect. Because this sensor data is raw, it must be processed or baked into an actual image file, that's where the Adobe Camera Raw (ACR) plug-in comes in.
What is Adobe Camera Raw?
ACR interprets the raw data and makes image information out of it. But every camera has a unique sensor and thus has a unique form of raw file. Even though camera manufactures may use the same file extension each time (e.g. Nikon raw files are always .NEF), each camera model has a different way of storing information. Because of this, we must continually update ACR for new cameras. As we add new cameras to the list (over 300 now) we update our published list of supported cameras. Additionally, with the changes to ACR, newer releases will not always be compatible with older versions of Photoshop Elements.
So, will the my raw files work with Photoshop Elements?
So if you are wondering if your camera is supported by ACR or will work in Photoshop Elements, first check this list: