- A
Use Always Encrypted with column master key stored in Azure Key Vault.
Why wrong: Always Encrypted protects specific columns at the client level, not backups.
- B
Configure Azure Backup for SQL Server in Azure VM and use Backup Center to manage encryption.
Why wrong: This is for IaaS VMs, not Azure SQL Managed Instance.
- C
Enable Transparent Data Encryption (TDE) with customer-managed keys and grant the managed instance's system-assigned managed identity 'get', 'wrapKey', and 'unwrapKey' permissions on the key vault.
This allows the managed instance to use the customer-managed key for TDE, which encrypts backups.
- D
Configure server-level firewall rules to allow Azure services to access the server.
Why wrong: Firewall rules control network access, not key access for backup encryption.
Quick Answer
The correct answer is to enable Transparent Data Encryption (TDE) with customer-managed keys and grant the managed instance's system-assigned managed identity 'get', 'wrapKey', and 'unwrapKey' permissions on the key vault. This configuration works because TDE with customer-managed keys in Azure Key Vault encrypts not only the database files but also all associated backups at rest, using a key that you control. The system-assigned managed identity acts as the secure identity for the SQL Managed Instance, and the specific permissions—'get' to retrieve the key, 'wrapKey' to encrypt the database encryption key during backup, and 'unwrapKey' to decrypt it during restore—are required by the backup service to perform these operations without exposing the key. On the DP-300 exam, this scenario tests your understanding of how TDE extends to backup encryption and the critical role of managed identity permissions; a common trap is confusing these with permissions for data encryption at rest in the database itself. A helpful memory tip is "Get, Wrap, Unwrap for Backup"—these three permissions are the minimum needed for the backup service to use your key.
DP-300 Implement a secure environment Practice Question
This DP-300 practice question tests your understanding of implement a secure environment. This is a configuration task: choose the command set that satisfies every stated requirement. Small differences — like 'secret' vs 'password' or 'transport input ssh' vs 'all' — change whether the answer is correct. 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 is migrating on-premises SQL Server databases to Azure SQL Managed Instance. You need to ensure that database backups are encrypted at rest using customer-managed keys stored in Azure Key Vault. You also need to allow the backup service to access the keys. What should you configure?
Answer choices
Why each option matters
Answer the question above first, then reveal the full breakdown to understand why each option is right or wrong.
Correct answer & explanation
Enable Transparent Data Encryption (TDE) with customer-managed keys and grant the managed instance's system-assigned managed identity 'get', 'wrapKey', and 'unwrapKey' permissions on the key vault.
Option C is correct because Transparent Data Encryption (TDE) with customer-managed keys (CMK) in Azure SQL Managed Instance encrypts database backups at rest. To allow the Azure backup service to access the key for backup encryption, the managed instance's system-assigned managed identity must be granted 'get', 'wrapKey', and 'unwrapKey' permissions on the Azure Key Vault where the CMK is stored. This ensures that backups are encrypted using the customer-controlled key, meeting the requirement for encryption at rest with customer-managed keys.
Key principle: Answer the scenario, not the keyword: identify the specific constraint before choosing the most familiar-sounding option.
Answer analysis
Option-by-option breakdown
For each option: why learners choose it and why it is or isn't the right answer here.
- ✗
Use Always Encrypted with column master key stored in Azure Key Vault.
Why it's wrong here
Always Encrypted protects specific columns at the client level, not backups.
- ✗
Configure Azure Backup for SQL Server in Azure VM and use Backup Center to manage encryption.
Why it's wrong here
This is for IaaS VMs, not Azure SQL Managed Instance.
- ✓
Enable Transparent Data Encryption (TDE) with customer-managed keys and grant the managed instance's system-assigned managed identity 'get', 'wrapKey', and 'unwrapKey' permissions on the key vault.
Why this is correct
This allows the managed instance to use the customer-managed key for TDE, which encrypts backups.
Related concept
Read the scenario before looking for a memorised answer.
- ✗
Configure server-level firewall rules to allow Azure services to access the server.
Why it's wrong here
Firewall rules control network access, not key access for backup encryption.
Common exam traps
Common exam trap: answer the scenario, not the keyword
The trap here is that candidates confuse Always Encrypted (which protects column data) with TDE (which protects the entire database and backups), leading them to select Option A instead of the correct TDE-based solution.
Detailed technical explanation
How to think about this question
TDE with CMK uses the managed instance's system-assigned managed identity to authenticate to Azure Key Vault for key operations. The 'wrapKey' and 'unwrapKey' permissions are required for the backup service to encrypt and decrypt the database encryption key (DEK) during backup and restore operations, respectively. In a real-world scenario, if the managed identity is deleted or permissions are revoked, backups become inaccessible, emphasizing the need for careful key lifecycle management.
KKey Concepts to Remember
- Read the scenario before looking for a memorised answer.
- Find the constraint that changes the correct option.
- Eliminate answers that are true in general but not in this case.
TExam Day Tips
- Watch for words such as best, first, most likely and least administrative effort.
- Review why wrong options are wrong, not only why the correct option is correct.
Key takeaway
Answer the scenario, not the keyword: identify the specific constraint before choosing the most familiar-sounding option.
Real-world example
How this comes up in practice
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
Got this wrong? Here's your next step.
Identify which exam domain this question belongs to, review the core concept, then practise similar questions from the same domain.
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Implement a secure environment — study guide chapter
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FAQ
Questions learners often ask
What does this DP-300 question test?
Implement a secure environment — This question tests Implement a secure environment — Read the scenario before looking for a memorised answer..
What is the correct answer to this question?
The correct answer is: Enable Transparent Data Encryption (TDE) with customer-managed keys and grant the managed instance's system-assigned managed identity 'get', 'wrapKey', and 'unwrapKey' permissions on the key vault. — Option C is correct because Transparent Data Encryption (TDE) with customer-managed keys (CMK) in Azure SQL Managed Instance encrypts database backups at rest. To allow the Azure backup service to access the key for backup encryption, the managed instance's system-assigned managed identity must be granted 'get', 'wrapKey', and 'unwrapKey' permissions on the Azure Key Vault where the CMK is stored. This ensures that backups are encrypted using the customer-controlled key, meeting the requirement for encryption at rest with customer-managed keys.
What should I do if I get this DP-300 question wrong?
Identify which exam domain this question belongs to, review the core concept, then practise similar questions from the same domain.
What is the key concept behind this question?
Read the scenario before looking for a memorised answer.
About these practice questions
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Same concept, more angles
2 more ways this is tested on DP-300
These questions test the same concept from different angles. Work through them to make sure you can recognise it however the exam phrases it.
Variation 1. You are designing a secure environment for Azure SQL Managed Instance. The company requires that all database backups be encrypted using customer-managed keys stored in Azure Key Vault. Which combination of actions should you take?
hard- A.Configure Always Encrypted with keys stored in Key Vault.
- ✓ B.Enable Transparent Data Encryption (TDE) with a customer-managed key in Azure Key Vault.
- C.Use Azure Storage Service Encryption to encrypt the backup files.
- D.Enable backup encryption using a certificate stored in the managed instance.
Why B: Option B is correct because Transparent Data Encryption (TDE) with customer-managed keys in Azure Key Vault allows you to encrypt the database backup files using a key that you control. When TDE is enabled and configured with a customer-managed key (CMK) stored in Azure Key Vault, Azure SQL Managed Instance automatically encrypts backups with the same TDE protector key, meeting the requirement for customer-managed backup encryption.
Variation 2. You are designing a security strategy for Azure SQL Managed Instance. The compliance team requires that all database backups be encrypted at rest using a customer-managed key. Which feature should you enable?
easy- ✓ A.Transparent Data Encryption (TDE) with a customer-managed key stored in Azure Key Vault.
- B.Always Encrypted with a column master key in Azure Key Vault.
- C.Transparent Data Encryption (TDE) with a service-managed key.
- D.Row-Level Security (RLS) with a custom authorization function.
Why A: Transparent Data Encryption (TDE) with a customer-managed key stored in Azure Key Vault is the correct feature because it encrypts the database at rest, including all backup files, using a key that the customer controls. This satisfies the compliance requirement for customer-managed key encryption of backups, as TDE automatically encrypts backups when the database is encrypted.
Last reviewed: Jun 24, 2026
This DP-300 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-300 exam.
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