If you don't currently use AD, then I wouldn't put one in place just for Dynamics. Dynamics supports logging in with Azure Active Directory (which is different to Active Directory), and so I would recommend you setup an AAD tenant and just use that, no VM's required.
azure windows server AD DC

Omar Almusalhi
21
Reputation points
Hello everyone,
greetings,
We are planning to have Windows Server in azure cloud to use it as AD DC because we are implementing dynamics 365 and we need an active directory to authenticate our users.
we currently do not have any AD in our environment and this is the first time to implement AD.
My question is:
do we have to implement AD on premises? is there any special requirements for dynamics 365 to connect to our AD?
And what is the requirement as an organization to implement through any vendor?
Best Regards,
Accepted answer
-
Sam Cogan 7,712 Reputation points MVP
2022-02-15T08:23:17.017+00:00 0 additional answers
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Azure AD basic is free, and should do what you need. If you needed some more advanced features, such as conditional access you would need additional licences.