Quick Answer
The answer is auto-labeling for sensitivity labels in Microsoft 365. This feature is designed to automatically detect and classify files containing personally identifiable information (PII) by scanning data at rest in SharePoint Online and applying the appropriate sensitivity label based on sensitive info types you configure. On the MS-102 exam, this question tests your understanding of the difference between auto-labeling for cloud data and the Microsoft Information Protection (MIP) scanner, which is only for on-premises file servers. A common trap is confusing Data Loss Prevention (DLP) policies, which detect and block but never apply labels, or retention labels, which manage lifecycle rather than classification. Remember: if you need to auto-label PII files in SharePoint, think “auto-labeling in the cloud”—the MIP scanner stays on-prem, and DLP only watches the door.
This MS-102 practice question tests your understanding of manage compliance by using microsoft purview. Read the scenario carefully and evaluate each option against the stated constraints before committing to an answer. 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 from an on-premises file server to SharePoint Online. You need to ensure that files containing personally identifiable information (PII) are automatically detected and classified with a sensitivity label. What should you use?
A retention label auto-applied by a trainable classifier.
Why wrong: Retention labels do not provide classification for protection.
Microsoft Information Protection scanner.
Why wrong: Scanner is for on-premises, not SharePoint.
A DLP policy to block sharing of PII.
Why wrong: DLP policies do not apply labels.
Auto-labeling for sensitivity labels in Microsoft 365.
Auto-labeling can scan SharePoint sites and apply labels automatically.
Answer choices
Answer the question above first, then reveal the full breakdown to understand why each option is right or wrong.
Correct answer & explanation
Auto-labeling for sensitivity labels in Microsoft 365.
Auto-labeling for sensitivity labels can scan files at rest in SharePoint and apply labels based on sensitive info types. Option C is correct. Option A is wrong because Microsoft Information Protection scanner is for on-premises file servers, not SharePoint. Option B is wrong because DLP policies do not apply labels. Option D is wrong because retention labels are for lifecycle, not classification.
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.
A retention label auto-applied by a trainable classifier.
Why it's wrong here
Retention labels do not provide classification for protection.
Microsoft Information Protection scanner.
Why it's wrong here
Scanner is for on-premises, not SharePoint.
A DLP policy to block sharing of PII.
Why it's wrong here
DLP policies do not apply labels.
Auto-labeling for sensitivity labels in Microsoft 365.
Why this is correct
Auto-labeling can scan SharePoint sites and apply labels automatically.
Related concept
Read the scenario before looking for a memorised answer.
Common exam traps
Many certification questions include familiar terms but test a specific constraint. Read the exact wording before choosing an answer that is generally true but wrong for this case.
Detailed technical explanation
This question should be treated as a scenario, not a definition check. Identify the problem, the constraint and the best action. Then compare each option against those facts.
Key takeaway
Answer the scenario, not the keyword: identify the specific constraint before choosing the most familiar-sounding option.
Real-world example
A cloud solutions architect for a retail company is evaluating services for a new workload. The correct answer here reflects best practice for the specific scenario described — not a general cloud recommendation. Answer the scenario, not the keyword: identify the specific constraint before choosing the most familiar-sounding option. Cloud exam questions reward reading the constraint carefully: the same technology can be right or wrong depending on the use case.
What to study next
Identify which MS-102 exam domain this question belongs to, then review the specific concept being tested. Practise related questions in that domain and focus on understanding why each wrong answer is tempting — not just why the correct answer is right.
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FAQ
Manage compliance by using Microsoft Purview — This question tests Manage compliance by using Microsoft Purview — Read the scenario before looking for a memorised answer..
The correct answer is: Auto-labeling for sensitivity labels in Microsoft 365. — Auto-labeling for sensitivity labels can scan files at rest in SharePoint and apply labels based on sensitive info types. Option C is correct. Option A is wrong because Microsoft Information Protection scanner is for on-premises file servers, not SharePoint. Option B is wrong because DLP policies do not apply labels. Option D is wrong because retention labels are for lifecycle, not classification.
Identify which MS-102 exam domain this question belongs to, then review the specific concept being tested. Practise related questions in that domain and focus on understanding why each wrong answer is tempting — not just why the correct answer is right.
Read the scenario before looking for a memorised answer.
About these practice questions
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Last reviewed: Jun 21, 2026
This MS-102 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 MS-102 exam.
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