Yes—Nikon AWL/CLS is optical, not radio. It uses coded light pulses from a commander, which can be a compatible camera’s built-in flash, a hot-shoe flash acting as commander, or an SU-800 IR commander.

If you use the built-in flash as commander, it still emits command pulses during the exposure sequence. Even when set so it doesn’t contribute to the exposure, some visible light may still be present, especially at close range. If you want to minimize that, use Nikon’s IR panel/filter for the built-in flash, a dedicated SU-800, or switch to radio triggers.

Not every Nikon body can use its built-in flash as a commander, so check your camera model.

For receiver placement: AWL works best with line of sight, but in practice it can often trigger from reflected light indoors. Outdoors in bright conditions it’s less reliable. On the SB-700 you can usually rotate the flash body so the sensor faces the commander, then aim the flash head where you want the light. If you need more reliable triggering regardless of placement, radio triggers are usually the better option.