Quick Answer
The correct choice is Data Discovery & Classification because it is the only Azure SQL Database feature that automatically discovers sensitive columns, such as those containing PII, and allows you to label them with built-in or custom sensitivity classifications. This solution directly addresses the need to automatically classify sensitive data in Azure SQL databases while integrating seamlessly with Azure SQL auditing and vulnerability assessment to track access to those labeled columns. On the AZ-500 exam, this question tests your ability to distinguish between data protection tools: a common trap is confusing Dynamic Data Masking, which only obfuscates output without classification, or Always Encrypted, which encrypts data but does not label or audit. Remember that classification comes first—you must discover and label before you can mask or encrypt. A useful memory tip is “Classify before you mask”—Data Discovery & Classification is the prerequisite step that enables all other sensitive data controls.
This AZ-500 practice question tests your understanding of secure compute, storage, and databases. Match the stated requirement to the specific cloud service, access model, or configuration option — many options are valid in isolation but not for this scenario. After answering, compare your reasoning against the explanation and wrong-answer breakdown below. Once you have made your selection, read the full explanation to reinforce the concept and understand why each distractor is designed to mislead on exam day.
Your company has a large number of Azure SQL databases that contain personally identifiable information (PII). You need to classify and protect sensitive columns across all databases. The solution must automatically discover and label sensitive data, and enable auditing of access to that data. What should you implement?
Always Encrypted with secure enclaves
Why wrong: Encrypts data but does not classify.
Microsoft Defender for SQL
Why wrong: Provides security alerts, not classification.
Dynamic Data Masking
Why wrong: Does not classify or audit.
Data Discovery & Classification
Automatically discovers and classifies sensitive data.
Answer choices
Answer the question above first, then reveal the full breakdown to understand why each option is right or wrong.
Correct answer & explanation
Data Discovery & Classification
Option D is correct because Azure SQL Database's Data Discovery & Classification automatically discovers sensitive columns, allows labeling, and integrates with auditing and vulnerability assessment. Option A is wrong because Dynamic Data Masking only masks data, it does not classify. Option B is wrong because Always Encrypted encrypts data at rest, but does not classify or audit. Option C is wrong because Microsoft Defender for SQL provides security alerts and vulnerability assessment, but not classification.
Key principle: Count usable hosts — not total addresses — and remember that the network and broadcast addresses are not available to hosts in standard IPv4 subnets.
Answer analysis
For each option: why learners choose it and why it is or isn't the right answer here.
Always Encrypted with secure enclaves
Why it's wrong here
Encrypts data but does not classify.
Microsoft Defender for SQL
Why it's wrong here
Provides security alerts, not classification.
Dynamic Data Masking
Why it's wrong here
Does not classify or audit.
Data Discovery & Classification
Why this is correct
Automatically discovers and classifies sensitive data.
Related concept
CIDR notation defines the prefix length.
Common exam traps
Subnetting questions often tempt you into counting all addresses. In normal IPv4 subnets, the network and broadcast addresses are not usable host addresses.
Detailed technical explanation
Subnetting questions test whether you can identify the network, broadcast address, usable range, mask and correct subnet. Slow down enough to calculate the block size correctly.
Key takeaway
Count usable hosts — not total addresses — and remember that the network and broadcast addresses are not available to hosts in standard IPv4 subnets.
Real-world example
A company's IT admin needs to give a contractor read-only access to production logs without sharing account credentials. Using role-based access control (RBAC) and temporary scoped permissions — not a permanent shared password — is the correct pattern. Questions like this test whether you can apply least-privilege access across cloud identity services.
What to study next
Review block sizes, usable host formulas (2^n − 2), and how to find network and broadcast addresses for /24 through /30. Then practise related AZ-500 subnetting questions on CIDR, address ranges, and subnet selection.
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FAQ
Secure compute, storage, and databases — This question tests Secure compute, storage, and databases — CIDR notation defines the prefix length..
The correct answer is: Data Discovery & Classification — Option D is correct because Azure SQL Database's Data Discovery & Classification automatically discovers sensitive columns, allows labeling, and integrates with auditing and vulnerability assessment. Option A is wrong because Dynamic Data Masking only masks data, it does not classify. Option B is wrong because Always Encrypted encrypts data at rest, but does not classify or audit. Option C is wrong because Microsoft Defender for SQL provides security alerts and vulnerability assessment, but not classification.
Review block sizes, usable host formulas (2^n − 2), and how to find network and broadcast addresses for /24 through /30. Then practise related AZ-500 subnetting questions on CIDR, address ranges, and subnet selection.
CIDR notation defines the prefix length.
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Last reviewed: Jun 21, 2026
This AZ-500 practice question is part of Courseiva's free Microsoft certification practice question bank. Courseiva provides original exam-style practice questions with explanations, topic-based practice, mock exams, readiness tracking, and study analytics to help learners prepare for the AZ-500 exam.
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