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FAQ: Why can't ArcToolBox define a Spatial Reference for a non-grid format raster?

Question

Why can't ArcToolBox define a Spatial Reference for a non-grid format raster?

Answer

This is a known limitation in ArcGIS. Only rasters of the grid format can have their Spatial Reference defined with the ArcToolbox 'Define Projection Wizard.' Use the raster dataset Properties dialog in ArcCatalog to define the spatial reference for other raster formats.