Enabling A Primary AD FS Server in Azure for Office365 Single Sign-On

  Step-By-Step: Enabling A Primary AD FS Server in Azure for Office365 Single Sign-On

avatar of mvp-kelsey-eppsMVP Kelsey EppsSeptember 10, 20141

This Step-By-Step will provide instruction to setup a primary AD FS 3.0 server on a Windows Server 2012 R2 virtual machine in Azure.  This post will accomplish the following:

Create the Azure Cloud Service

Build the Azure virtual machine

Install the AD FS 3.0 role

Configure AD FS 3.0

Federate with Office365

Microsoft Virtual Academy provides a great precursor to this Step-By-Step entitled: Managing Office 365 Identities and Services


Azure account is setup
Directory Sync is activated, setup and running
Valid SSL certificate is available (with private key)
VPN connection setup from Azure to your on premise network
Step 1: Create a New Cloud Service

Because we are going to load balance one or more virtual machines, we need to create a Cloud Service to put them in. Think of it as a bucket to hold your virtual machines. You will require one for the AD FS Servers and one for the Web Application Proxies (AD FS Proxy Servers)

Click New
Select Compute -> Cloud Service -> Custom Create


Enter a URL or Name for the Cloud Service. This name must be unique across the .cloudapp.net name space.
Select your Region or Affinity Group
Click OK

Step 2: Create the Virtual Machine in Azure

Click New
Select Compute -> Virtual Machine -> From Gallery

Choose Windows Server 2012 R2 Datacenter
Click Next


Enter Virtual Machine Name
Select Server Tier
Select Server Size
Click Next


Select the AD FS Cloud Service that was created earlier. This is very important.
Step 3: Verify Subnet

Drop down to Create an availability set
Enter name for the availability set

NOTE: This does not load balance the servers, it will just place the VM accordingly so that if a rack of servers goes down, all the members of the set will be placed in different fault domains. This ensures that an outage isn’t extended to all the servers in the set.

Click Next


Click Next
Once the VM is provisioned go to the next step


Step 4: Add the Server to the Domain

Since the AD FS server needs to authenticate against Active Directory, they need to be added to the local domain. Add the server to the local domain

Step 5: Install the Azure Active Directory Module for Windows PowerShell

Use this BLOG post to install the Azure Active Directory Module for PowerShell and the required Microsoft Online Services Sign-In Assistant 7.0

Connecting to Office365 with PowerShell

Step 6: Install the AD FS Role

Open Server Manager
Click Add roles and features


Click Next


Select Role-based or feature-based installation
Click Next


Make sure that the AD FS Server is listed as the server to install to
Click Next


Select Active Directory Federation Services
Click Next


Leave defaults
Click Next


Click Next


Click Install


Wait for the install to complete

Step 7: Import the SSL Certificate

AD FS uses certificate to secure the connection from AD FS to Office365. For this reason, we need a valid SSL certificate. I choose to use GoDaddy, as I find they are a one stop shop for all my domain needs. It’s a personal choice, so use whoever you feel comfortable with. For the purposes of this BLOG post, I will use a multi-name certificate; I DON’T recommend this for a production environment. A couple reasons are that I like to keep things simple and if we have multiple names on the certificate, it starts to get complicated (not technically, but management of the certificate). Secondly, I don’t like to share certificates across services. This cuts down on the cross contamination from the support teams at larger companies. If you lump the AD FS services with the Exchange certificate, AD FS usually gets left in the dust and forgot about when it comes time to renew.

Open the Start Screen


Type MMC
Click the MMC app


MMC opens


Click File
Click Add/Remove Snap-in
Select Certificates
Click Add>


Select Computer Account
Click Next


Select Local Computer
Click Finish


Click OK


Expand Certificates
Expand Personal
Right Click Certificates
Select Import


Select Local Machine
Click Next


Browse to the Exported Certificate
Click Next


Enter Password
Mark the key as exportable
Click Next


Place in the Personal certificate store
Click Next


Click Finish


Click OK


Step 8: Setup and Configure AD FS 3.0

Open Server Manger
Select AD FS
Click More… where it says Configuration required for Active Directory Federation Servers at…


Click Configure the federation service… action on the Post-Deployment Configuration


Select Create the first federation server in a federation server farm
Click Next


Enter credentials for a user that has domain administrator permissions. This is used to complete the install, it’s not used as the AD FS service account
Click Next


Select the SSL certificate that you imported
Select the Federation Service Name
Enter the Federation Service Display Name

NOTE: Since I am using a multi-name certificate these three values don’t match for me. In production I always recommend that you use a single name certificate to keep things simple. If that’s the case then the three values below should all match e.g. sts.domain.com

Click Next


Enter the AD FS Service Account Name and Password

NOTE: This can be a managed service account or a domain user account designated for AD FS. If you use a domain user account, it does not need any special permissions. The install will give it the permissions required.

Click Next


Select Windows Internal Database or the location of a SQL Server Database. The choice is yours, but for most companies the Windows Internal Database works just fine
Click Next


Click Next


Wait for the Pre-requisite checks to be completed

Click Configure


Click Close

Step 9: Federate with Office365

Open the Desktop on the AD FS server
Find Azure Active Directory Module for Windows PowerShell


Right Click and Run As Administrator
Set the credential variable


Enter a Global Administrator account from Office 365
Connect to Microsoft Online Services with the credential variable set previously

- Connect-MsolService –Credential $cred

Set the MSOL ADFS Context server, to the ADFS server (optional if you are on the AD FS server)

- Set-MsolADFSContext –Computer adfs_servername.domain_name.com

Convert the domain to a federated domain

- Convert-MsolDomainToFederated –DomainName domain_name.com

Successful Federation

- Successfully updated ‘domain_name.com‘ domain

Verify federation

- Get-MsolFederationProperty –DomainName domain_name.com

This concludes the setup of the first AD FS server and federation with Office365.

Tags Active Directory Microsoft Office MVP Office 365 Step-By-Step Windows Server 2012 R2