Thank you for posting this in Microsoft Q&A.
I understand you are trying to disable "Stay signed in" pop up under user settings for Default Directory in Microsoft Entra admin center but you are encountering error "Failed to update".
To Configure the 'keep me signed in' (KMSI) option requires one of the following licenses:
- Microsoft Entra ID P1 or P2
- Office 365 (for Office apps)
- Microsoft 365
You must have the Global Administrator role to enable the 'Stay signed in?' prompt.
Could you please confirm whether you have required permissions and license available.
For reference: https://learn.microsoft.com/en-us/entra/fundamentals/how-to-manage-stay-signed-in-prompt
Hope this helps. Do let us know if you any further queries.
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