The cross-reference is a REF field.

To look at what fields are there, press Alt+F9 which toggles display of field codes.
You can see the field structure and code. (not completely for AutoTextList or HyperLink Fields, though)*

When you insert a cross-reference you insert a Ref field. If it is to anything other than an existing Bookmark (i.e. Heading, Caption) a hidden bookmark is inserted at the location you are cross-referencing.

You can get funky results if, after you insert a cross-reference, you go to the beginning of the referenced material and type. Say you want to insert something above what you cross-referenced. You go to the start and press Enter, move up and then start typing what you wanted to add. Say it is a heading. You reformat what you type to Normal or Body Text. Everything looks fine. When you update the cross reference (REF) field, it will now include what you added.

Hyperlinks also create these bookmarks but are not quite as problematic because they do not update to show the content linked. However, they still will go to the start of the hidden bookmark.

Answered by Stefan Blom in the answers forum.
References:

• Insert Cross-References
• Change Word Field Formatting Switch - MergeFormat/CharFormat by Graham Mayor, MVP (I use this.)
• Take a look at the more resources at the bottom of my page on Dealing with Fields in Microsoft Word

* See Pop-Up Text in Microsoft Word for more about the AutoTextList and Hyperlink Fields


Susan, I again ask you to please read A Message to Forum Cross-Posters. Take it to heart.

• You posted this here and in the Word Answers Forum within minutes of each other this morning.
• You did note the cross-post here, but not there.
• You did not wait to see what response you got in one of the forums.
• You did not follow basic etiquette.
• You are a good person and eager to learn more about using Word.
• You are exactly the kind of person we want to help.

You have been asking a lot of questions in the forums. This is a good thing. See also:

• Basics: Getting help - best practices
• How to Ask Questions In this Forum (to get the best and quickest answers)

I can say this here but am hesitant to be so blunt on the other answers forum. This is not a rant about you but about the other forum, where I am also a volunteer moderator.

• The people there with the badge Independent Advisor work for an outside company paid by Microsoft to provide quick responses to questions. They often do not know what they are talking about, but are quick. Often their responses seem to come from Google searches and/or AI. They are paid more for speed than for accuracy.
  
• The ones with the badge Microsoft Agent are somewhat better but often come up with a stock answer full of gobbledey-gook. They do not, I think, use Word.
• Volunteer moderators, there, as here, try to keep the forum on track and usually know the program very well. They have been using the program for years.
  
• There are often responses by other knowledgeable users.
  
• The ones who have and MVP badge really know Word, can spot problems that confuse the others, and give good answers. They are also volunteers, but experts in the program.
• You can learn more about the "badges" in the other forum here. That forum is the official Microsoft forum, while this one is completely independent.
  

Stefan is one of those MVPs.