Quick Answer
The answer is Settings > Domains in the Microsoft 365 admin center. This is the correct location because domain verification relies on adding a TXT record to your external DNS zone, and the admin center’s Domains page is the only interface that generates the unique verification value and validates that the record has propagated. On the MS-102 exam, this tests your understanding of the prerequisite steps for custom domain configuration, often appearing as a straightforward navigation question designed to separate those who know the exact path from those who might guess at other areas like Users or Billing. A common trap is assuming verification happens under Exchange admin center or during user setup, but Microsoft 365 centralizes all domain management under Settings > Domains. Memory tip: think “Settings first, then Domains” — you must configure the domain before you can assign it to users or services.
This MS-102 practice question tests your understanding of deploy and manage a microsoft 365 tenant. 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 organization has a Microsoft 365 tenant configured with a custom domain. You need to verify domain ownership using a TXT record. Where in the Microsoft 365 admin center would you initiate this process?
Settings > Domains
Correct path to manage domains and verify ownership.
Setup > Org-wide settings
Why wrong: This section contains organizational settings but not domain management.
Users > Active Users
Why wrong: This is for user management, not domain verification.
Admin centers > Azure Active Directory
Why wrong: While you can verify domains in Entra ID, the primary location is in the Microsoft 365 admin center under Settings > Domains.
Answer choices
Answer the question above first, then reveal the full breakdown to understand why each option is right or wrong.
Correct answer & explanation
Settings > Domains
To verify domain ownership in Microsoft 365, you must add a TXT record provided by Microsoft to your domain's DNS zone. The process is initiated in the Microsoft 365 admin center under Settings > Domains, where you select the domain and click 'Start setup' to receive the verification TXT record value. This is the only location in the admin center that directly manages domain verification and DNS record validation for custom domains.
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.
Settings > Domains
Why this is correct
Correct path to manage domains and verify ownership.
Related concept
Read the scenario before looking for a memorised answer.
Setup > Org-wide settings
Why it's wrong here
This section contains organizational settings but not domain management.
Users > Active Users
Why it's wrong here
This is for user management, not domain verification.
Admin centers > Azure Active Directory
Why it's wrong here
While you can verify domains in Entra ID, the primary location is in the Microsoft 365 admin center under Settings > Domains.
Common exam traps
The trap here is that candidates may confuse domain verification with other domain-related tasks (like setting up email routing or managing user accounts) and select Setup > Org-wide settings or Users > Active Users, but only Settings > Domains provides the guided wizard for adding and verifying a custom domain via TXT records.
Detailed technical explanation
Domain verification in Microsoft 365 relies on DNS TXT records as defined in RFC 1035. When you add a custom domain, Microsoft generates a unique verification string (e.g., MS=msXXXXXXXX) that must be published as a TXT record in the domain's public DNS zone. The Microsoft 365 admin center polls the DNS to confirm the record exists before marking the domain as verified; this process can take from a few minutes to 72 hours depending on DNS propagation. In real-world scenarios, failing to remove the TXT record after verification can cause issues if you later need to re-verify the domain.
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
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FAQ
Deploy and manage a Microsoft 365 tenant — This question tests Deploy and manage a Microsoft 365 tenant — Read the scenario before looking for a memorised answer..
The correct answer is: Settings > Domains — To verify domain ownership in Microsoft 365, you must add a TXT record provided by Microsoft to your domain's DNS zone. The process is initiated in the Microsoft 365 admin center under Settings > Domains, where you select the domain and click 'Start setup' to receive the verification TXT record value. This is the only location in the admin center that directly manages domain verification and DNS record validation for custom domains.
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 24, 2026
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