Are you referring to the legacy drag tool which was available in Build-mode? It uses the mouse object and just positions the part according to the value of “mouse.Hit”, while target filtering the part instance being moved.
You can inspect the source code yourself. These are Lua draggers and they’re implemented as built-in plugins which you can fetch from your installation of Studio.
%appdata%\..\Local\Roblox → Find the latest Studio version folder → Check BuiltInPlugins