When you open a RAW image from Camera Raw into Photoshop, you’ll have the option of opening it in standard 8-bit mode (which is the regular ol’ mode for editing images in Photoshop) or in the larger 16-bit color mode. Without going into all the pros and cons (and yes there are both pros and cons, which are argued endlessly on the Internet), here’s how to do it: When you’re in Camera Raw, at the bottom center of the window, you’ll see a list of specs that looks like an underlined web link (circled above). Click on that link and it brings up Camera Raw’s Workflow Options dialog. This is where you choose how you’ll actually open your images in Photoshop and, near the top right, you’ll see a pop-up menu for bit depth. Choose 16-Bits/Channel from the Depth pop-up menu, click OK, and now your RAW image will open in Photoshop in 16-bit mode. (Note: JPEG images are captured in 8-bit mode. So, if you shoot in JPEG, choosing 16-bit mode won’t add anything but more file size to your image, so I don’t recommend it.) Once you’re done editing your image in Photoshop, if you want to convert back to 8-bit mode, just go under the Image menu, under Mode, and choose 8-Bits/Channel.
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