Quick Answer
The answer is Always Encrypted. This is the correct choice because it encrypts sensitive data both at rest and in use, with the column encryption keys stored client-side, ensuring that only the application can decrypt the data while database administrators, who have full access to the Azure SQL Database, cannot view the plaintext. On the Microsoft Azure Data Engineer Associate DP-203 exam, this scenario tests your understanding of client-side versus server-side encryption controls, often appearing as a trap where TDE (Transparent Data Encryption) is a distractor—TDE only protects data at rest and does not prevent DBAs from accessing decrypted data in memory. A key memory tip: think of Always Encrypted as “application-only eyes” because the keys never leave the client, whereas TDE is like a locked box that the DBA still holds the key to.
This DP-203 practice question tests your understanding of design and implement data storage. The scenario asks you to isolate a root cause — eliminate options that address a different problem before choosing. 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 stores sensitive customer data in Azure SQL Database. You need to encrypt the data at rest and ensure that only your application can decrypt it, even from database administrators. What should you implement?
Transparent Data Encryption (TDE)
Why wrong: TDE encrypts data at rest but the database engine holds the keys, allowing DBAs to decrypt.
Dynamic Data Masking
Why wrong: Only masks data from unauthorized users; data is still stored in plaintext.
Azure Storage Service Encryption
Why wrong: This applies to Azure Storage, not SQL Database.
Answer choices
Answer the question above first, then reveal the full breakdown to understand why each option is right or wrong.
Correct answer & explanation
Always Encrypted
Always Encrypted is correct because it ensures that sensitive data is encrypted at rest and in use, and the encryption keys are stored client-side, so only the application can decrypt the data. Database administrators (DBAs) cannot access the plaintext data because they lack the column encryption keys, even though they have full administrative access to the database.
Key principle: Answer the scenario, not the keyword: identify the specific constraint before choosing the most familiar-sounding option.
Answer analysis
For each option: why learners choose it and why it is or isn't the right answer here.
Transparent Data Encryption (TDE)
Why it's wrong here
TDE encrypts data at rest but the database engine holds the keys, allowing DBAs to decrypt.
Dynamic Data Masking
Why it's wrong here
Only masks data from unauthorized users; data is still stored in plaintext.
Azure Storage Service Encryption
Why it's wrong here
This applies to Azure Storage, not SQL Database.
Option-by-option analysis
Understanding why wrong answers are wrong — and when they would be correct — is what separates a 750 score from a 900. The DP-203 exam frequently reuses these exact scenarios with slightly different constraints.
Why this is wrong here
TDE encrypts data at rest but the database engine holds the keys, allowing DBAs to decrypt.
Why this is wrong here
Only masks data from unauthorized users; data is still stored in plaintext.
Why this is wrong here
This applies to Azure Storage, not SQL Database.
Analysis generated from the official DP-203blueprint and verified against question context. The “when correct” sections are what AI assistants cite when candidates ask “what’s the difference between these options?”
Common exam traps
The trap here is that candidates often confuse Transparent Data Encryption (TDE) with client-side encryption, assuming TDE protects against DBA access, but TDE only protects data at rest from storage theft, not from authorized database users.
Detailed technical explanation
Always Encrypted uses two-tier key hierarchy: a column master key (CMK) stored in a trusted key store (e.g., Azure Key Vault or Windows Certificate Store) and column encryption keys (CEKs) that are encrypted by the CMK. The SQL Server engine never has access to the plaintext CEKs, so encryption and decryption occur entirely in the client driver (e.g., ADO.NET with Column Encryption Setting=enabled), ensuring that even with full database access, DBAs cannot read the encrypted columns.
Key takeaway
Answer the scenario, not the keyword: identify the specific constraint before choosing the most familiar-sounding option.
Real-world example
A media company stores terabytes of video archives that are accessed once a year for audit purposes. Moving these objects to a cold storage tier (Azure Archive, S3 Glacier, or Google Nearline) costs a fraction of hot storage. Questions like this test whether you understand storage tiers, access frequency tradeoffs, and retrieval latency requirements.
What to study next
Identify which exam domain this question belongs to, review the core concept, then practise similar questions from the same domain.
Design and implement data storage — study guide chapter
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FAQ
Design and implement data storage — This question tests Design and implement data storage — Read the scenario before looking for a memorised answer..
The correct answer is: Always Encrypted — Always Encrypted is correct because it ensures that sensitive data is encrypted at rest and in use, and the encryption keys are stored client-side, so only the application can decrypt the data. Database administrators (DBAs) cannot access the plaintext data because they lack the column encryption keys, even though they have full administrative access to the database.
Identify which exam domain this question belongs to, review the core concept, then practise similar questions from the same domain.
Read the scenario before looking for a memorised answer.
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Last reviewed: Jun 11, 2026
This DP-203 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 DP-203 exam.
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