The Dart SDK is downloaded from one of the supported channels, cached in bin/cache/dart-sdk and is used to run Flutter Dart code.
The file bin/internal/dart-sdk.version determines the version of Dart SDK that will be downloaded. Normally it points to the dev channel (for example, 1.24.0-dev.6.7), but it can also point to particular bleeding edge build of Dart (for example, hash/c0617d20158955d99d6447036237fe2639ba088c).