Similar to embedded video, sound may be placed directly on the timeline as well.
Doing so allows you to sync animation or actionscript code to specific keyframes of the sound. Like embedded video, placing sound on the timeline will increase the filesize of your project.

It is also possible to use actionscript to handle sound and loading external sound through the Sound class.

new Sound(urlRequest)
first set up the URLRequest to the mp3 file
play() – play the sound from a particular starting point and indicate looping
manipulate the sound (volume, panning, etc)
New with Flash 9 is the ability to analyze sound. This is done through the SoundMixer class. Mike Chambers has an excellent example on how to visualize sound using this class. At this time, it appears that it is not possible to analyze sound with the SoundMixer class with the microphone.

Sound may also be created and manipulated in Flash 9. This is an example of an 8-bit Amiga Modplayer, and the developers have source code available here.