[R] using categorical variable in multiple regression

[setlist]

Hello, I wanted to do the multiple regression on categorical predictor data
there's variable x1,x2,x3 and x3 is categorical one.
so i just used as.factor(x3) and then ran multiple regression
is it a good way to do the multiple regression on categorical predictor
data?
and how can I interpret the estimates? 
also if using as.factor is a good way, is there any difference with doing
dummy coding for categorical variable and then running regression?
Thanks.

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