Your question requires some nuance to answer.
1) you never are obligated to carry identification on you in California unless you are in a secure locus, such as an airport, secured facility or other sensitive location. While you are the random Joe Blow on the street, you can walk around with no ID on you.
2)HOWEVER, once the police have a reason to stop a person the can demand identification and legally hold someone for a reasonable amount of time to determine their identification. As for the reasons to stop, the 4th amendment has been interpreted to allow a stop based only on reasonable suspicion. This is a VERY low standard and can be found based only on innocent behavior, coupled with an officer's training and experience that a crime MIGHT be afoot. (See Terry v. Ohio).
These stops can also be sustained based on calling the police to report a crime, being in the location where a crime was reported or even being a witness to a crime or accident.
3) if you are stopped lawfully and you do not have a license, the police have several actions they can choose from. These range from taking a thumb print at the scene to finally arresting someone and hold then at the police station pending positive identification.
The moral is, you can save yourself a lot of hassle by just carrying ID. While it is noted required, you also do not have the legal right to refuse to identify yourself under certain circumstances.
Also, always remember, while you do have to identify yourself, you DO NOT, EVER, have to be a witness against yourself. So do not talk to the police about anything. At all. Good luck.
You are not required to carry identification in public unless you are behind the wheel of an automobile or are in a secure location.
Under a case called Florida v Royer, for an encounter with an officer to be consensual, you must feel free to terminate it at any time. However, most courts in my experience have held it reasonable for an officer to approach, as you your name, and ask if you would willingly answer questions. Once that stop is delayed or you no longer consent, it becomes a seizure of the person and may be challenged (not always successfully). The officer may stop you if he has a reasonable suspicion of criminal activity or he may stop you if he has probable cause for an arrest. These are incredibly complex and nuanced areas of law and there is no way that I can explain them here.
A suspicion is generally enough for a brief detention while the officer may pose questions to you and conduct a pat-down search (aka a "Terry frisk") of your person in order to protect officer safety. A reasonable suspicion of criminal activity is an exception to the warrant requirement.
With the limitations listed by other attorneys already, you are not required to carry your identification with you. If you get pulled over, what do you do? I don't recommend you refuse to identify yourself. What does the police officer do? If you flunk the "personality test", they can simply take you in for investigation on a number of bogus excuses and then they can release you within 72 hours if nothing is found on your fingerprint match. If you were courteous and had a good reason for not having your ID with you at the time, the officers can simply let you go.
OSCAR E. TOSCANO
I am licensed to practice in the state of California. I handle cases from Sacramento to San Diego. I have handled cases in Federal District courts from Alaska and throughout the United States. My comments and opinions are based on California law and are based on the limited information provided in the question. Legal questions are usually fact specific and a few facts can and often does change the opinion I would give. It is better to consult with an attorney in your jurisdiction (your geographic area) and provide specific details regarding your case in private. You would get more specific advice. The contents of the conversations with your attorney are confidential and are protected from being revealed. The statements made in this public forum (AVVO) are not confidential and could be revealed. Therefore, you must be very careful in the details you provide. Do not disclose information that could be a crime or that could be used in order to prove a crime was committed. If you are in California and want to clarify any of my answers, feel free to contact me.