Configuring Microsoft Entra ID Connect for a Hybrid Identity Environment – Step-by-Step Guide

Introduction:

Hybrid identity remains one of the most common deployment models for organizations migrating to Microsoft Entra ID while continuing to use Active Directory Domain Services (AD DS). Instead of maintaining separate identities in both environments, organizations synchronize their on-premises users, groups, and selected attributes into Microsoft Entra ID, enabling users to access both on-premises and cloud resources with a single identity.

In this article, we’ll explore what Microsoft Entra ID Connect is, how it differs from Microsoft Entra Cloud Sync, why organizations still choose Entra ID Connect, and walk through the configuration of Entra ID Connect in a hybrid environment.

What is Microsoft Entra ID Connect?

Microsoft Entra ID Connect is Microsoft’s identity synchronization solution that connects an on-premises Active Directory forest with Microsoft Entra ID.

It synchronizes identity information such as:

  • Users
  • Groups
  • Contacts
  • Password hashes
  • Selected Active Directory attributes

This enables users to sign in using the same username and password across:

  • Windows Active Directory
  • Microsoft 365
  • Azure Portal
  • Microsoft Teams
  • Exchange Online
  • SharePoint Online
  • Applications integrated with Microsoft Entra ID

Rather than creating cloud-only accounts, organizations can continue managing identities from Active Directory while Microsoft Entra ID becomes the cloud identity provider.

The synchronization engine runs on a Windows Server joined to the Active Directory domain and periodically synchronizes changes to Microsoft Entra ID.

Microsoft Entra ID Connect Sync vs Microsoft Entra Cloud Sync

Although both solutions synchronize Active Directory identities to Microsoft Entra ID, they are built differently and target different scenarios.

FeatureMicrosoft Entra ID ConnectMicrosoft Entra Cloud Sync
Synchronization EngineLocal synchronization serverLightweight provisioning agent
InstallationDedicated Windows ServerProvisioning Agent
Password Hash SyncSupportedSupported
Pass-through AuthenticationSupportedNot Supported
Federation SupportSupportedNot Supported
Device WritebackSupportedNot Supported
Group WritebackNot SupportedSupported
Exchange HybridFully SupportedLimited
Complex Hybrid DeploymentsExcellentBasic
High AvailabilityStaging ModeMultiple Agents
Best ForEnterprise Hybrid IdentityCloud-first organizations

When should you choose Entra ID Connect?

Use Microsoft Entra ID Connect when your organization requires:

  • Exchange Hybrid deployment
  • Pass-through Authentication
  • Federation Services
  • Device Writeback
  • Complex Active Directory topology
  • Multiple forests
  • Advanced synchronization rules

Prerequisites

Before installing Microsoft Entra ID Connect, ensure the following prerequisites are met:

  • Microsoft Entra ID tenant
  • Verified custom domain
  • Active Directory Domain Services
  • Domain Administrator account
  • Microsoft Entra Global Administrator account
  • Windows Server (2019, 2022, or later)
  • Internet connectivity from the synchronization server
  • TLS 1.2 enabled
  • Latest Windows Updates installed

Installation:

Step 1 – Download Microsoft Entra ID Connect

Download the latest Microsoft Entra ID Connect installer from the Microsoft Entra ID Admin Center

Copy the installer to the server that will host the synchronization service.

Connect Sync

Step 2 – Launch the Installation Wizard

Run AzureADConnect.msi the downloaded installation file

Go with the express setting to install all necessary configurations and components

Step 3 – Sign in to Microsoft Entra ID

Enter your Microsoft Entra Global Administrator credentials.

The wizard verifies:

  • Tenant connectivity
  • Verified domains
  • Required permissions

Step 4 – Connect to Active Directory

Provide:

  • Domain Administrator username
  • Password

Click Add Directory.

The wizard creates the required service account for synchronization.

Step 5 – Review and Install

Review your configuration.

Click:

Install

The synchronization engine is configured, and the initial synchronization begins.

Verify Synchronization

I already have some groups and users in my on-prem AD, as shown in the figure below. Wait for some time and verify whether it is synced to Entra ID

Users

AD User

Groups

AD groups

Let’s check the Users and Groups in Entra ID admin center

Entra ID Groups

You can see all synced Groups in MS Entra ID and the source as Windows Server AD

Entra User

Synced User with the On-premises sync enabled flag

Summary

Microsoft Entra ID Connect remains the most comprehensive solution for organizations that require a rich hybrid identity experience between Active Directory and Microsoft Entra ID. While Microsoft Entra Cloud Sync offers a lightweight alternative for cloud-first environments, Entra ID Connect remains the preferred choice for enterprises that need advanced synchronization capabilities, such as Exchange Hybrid, Pass-through Authentication, federation, and writeback.

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