Azure Active Directory: The Center of Your Microsoft Azure Identity

Azure Active Directory has similarities to on-premises Active Directories but offers notable differences. Here’s an overview of Azure AD, its benefits, and how to get started.

Brien Posey

March 1, 2023

4 Min Read
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Although the public cloud is often lauded for its many benefits, the transition to cloud services brings with it various challenges. Many of these challenges are tied to issues such as authentication and access control.

Active Directory – Microsoft’s directory service for identity management, authentication, and access control –  predates the public cloud and simply was not designed with the cloud in mind. This is where Azure Active Directory (more commonly known as Azure AD) comes into play.

Azure Active Directory is a cloud-based Active Directory environment with many similarities to on-premises Active Directories.

Introduction To Azure Active Directory

The main difference between on-premises Active Directories and Azure AD is that Azure AD is offered as a managed service. That means that Microsoft takes care of much of the infrastructure-level management for Azure AD users.

For instance, when an organization deploys an on-premises Active Directory environment, it must set up a Windows Server machine, install the Active Directory role, deploy a DNS server, and perform various other configuration tasks. After completing the configuration process, there remains ongoing maintenance to do – e.g., installing security patches as they become available.

Related:What Is Active Directory Users and Computers?

With Azure Active Directory, however, Microsoft sets up and maintains the environment for you. That means an organization doesn’t have to create or maintain the underlying virtual machines.

What Are the Benefits of Using Azure Active Directory?

The main benefit of using Azure Active Directory is that it acts as a cloud-native mechanism for authentication and access control. In other words, you don’t have to worry about using an on-premises authentication mechanism for cloud-based workloads, nor do you have to rely on a proprietary cloud-based authentication and access control product. Azure Active Directory integrates neatly into your existing Active Directory infrastructure or works as a standalone identity management technology.

Organizations can extend Azure Active Direction features and functionality via paid subscriptions. Azure Active Directory is available in two premium subscriptions, known as Premium P1 and Premium P2.

  • A Premium P1 subscription removes the Azure Active Directory object limit so organizations can have an unlimited number of directory objects. The subscription also provides access to features such as multifactor authentication, dynamic groups, and advanced security reports.

  • The Premium P2 subscription adds more identity protection capabilities, privileged identity management, entitlement management, and Access review features.

How Is Azure Active Directory Different From Other Directory Services?

As previously noted, Azure Active Directory is primarily used for authentication and access control services in the cloud. However, Azure Access Directory can also be configured to provide single sign-on services. Additionally, directory services can be extended to multiple clouds (by linking to other directory services).

Another Azure Active Directory differentiator is that it can integrate with on-premises Active Directory environments.

Since Azure Active Directory is offered as a managed service and there is no access to the underlying virtual machine, organizations can’t simply join Azure Active Directory to an existing Active Directory forest. Instead, Microsoft allows Active Directory integration via synchronization.

To synchronize an on-premises Active Directory environment to Azure Active Directory, organizations must run a free tool called Azure AD Connect on an on-premises virtual machine. Azure AD Connect synchronizes on-premises Active Directory user accounts in groups to Azure Active Directory so that users can access cloud-based resources through their existing Active Directory accounts.

How Do You Get Started With Azure Active Directory?

To get started with Azure Active Directory, set up a Microsoft Azure account and then create an Azure Active Directory environment using the Azure portal. You can access the Azure Active Directory by using the Azure Active Directory Admin Center.

Note that Azure Active Directory is included with Microsoft 365. That means that an organization may already have Azure Active Directory, even if they do not have a Microsoft Azure subscription.

Microsoft Office servers such as Exchange Server and SharePoint had a dependency on the Active Directory environment. The dependency did not go away when Microsoft chose to make the services available in the Microsoft 365 cloud. As such, Microsoft used Azure Active Directory to provide the backend infrastructure required by Microsoft 365 services. You can access the Azure Active Directory Admin Center through Microsoft 365, just as you can through the Microsoft Azure Portal.


Azure Active Directory is the definitive authentication and access control mechanism for cloud-based, Microsoft workloads. It is also an integral part of Microsoft 365. Organizations that operate primarily on-premises can still leverage Azure Active Directory by using Azure AD Connect to synchronize their on-premises Active Directory objects to the cloud.

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About the Author(s)

Brien Posey

Brien Posey is a bestselling technology author, a speaker, and a 20X Microsoft MVP. In addition to his ongoing work in IT, Posey has spent the last several years training as a commercial astronaut candidate in preparation to fly on a mission to study polar mesospheric clouds from space.

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