What is the difference between Azure Active Directory and Azure Active Directory Domain Services?

Question

What is the difference between Azure Active Directory and Azure Active Directory Domain Services? Why would I need AADDS?

Answer 1

Azure Active Directory is a cloud-native service that provides identity services for organizations using platforms such as Azure, Microsoft 365 and Dynamics 365. It is a new identity source, so it doesn't have native support for concepts such as Group Policy Objects or another native AD functionality.

Azure Active Directory Domain Services, by contrast, is the equivalent of running a domain controller, in the cloud, as a service. So all the features of Active Directory are there, out-of-the-box.

If you're looking to span your on-premise AD environment to gain greater flexibility, you might leverage AADDS.

Almost every cloud environment leverages AAD; a much smaller subset will likely use AADDS.

Answer 2

Please check below Microsoft Learn
Compare self-managed Active Directory Domain Services, Azure Active Directory, and managed Azure Active Directory Domain Services.

https://learn.microsoft.com/en-us/azure/active-directory-domain-services/compare-identity-solutions