How To Set Up A Office 365 Hybrid Exchange Environment

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office 365 hybrid
Reading Time: 4 minutes

Exchange Online is one of the most commonly-used applications in an Office 365 hybrid environment. But to use the application, you need to set it up. What Exchange Online gives businesses is the opportunity for employees to collaborate. The application connects with Outlook and allows users access to shared emails, calendars, addresses, lists, and conference rooms.

You must set up an Office 365 hybrid Exchange environment to unlock these features. The hybrid deployment integrates the on-premise Exchange application with Office 365, giving you the benefits of both. With the application offering so much, it makes sense to begin the hybrid configuration wizard now.

On-premises Exchange organizations can secure mail transport to adjust the hybrid configuration to enhance Exchange Online protection. Therefore, on-premises Exchange servers operate to improve the Exchange on-premises organization, as both the on-premises provide hybrid setup to secure mail flow.

However, setting up an Office 365 hybrid exchange environment is no small task. So that’s why we’re going to walk you through the process. So with all that said, let’s start.

Step by Step Guide on Setting Up an Office 365 Hybrid Exchange Environment

You need to do one thing before beginning the hybrid configuration process. That thing is to update the on-premise Exchange. Once you get that over the line, you can begin the Exchange hybrid configuration setup. The steps below outline the instructions to do that. So, let’s begin.

Step 1: Synchronizing the Active Directory

The first step is to choose a synchronizing directory option. Exchange Online offers several options, each outlining a unique relationship between the on-premise Active Directory and users. The options are the following:

  • Manage and authenticate users on the on-premises Active Directory without Azure;
  • Manage and authenticate users on the on-premises Active Directory with Azure;
  • Manage users on-premises but authenticate with Azure AD.

These are the three available synchronization relationships. But considering the complexity of the tasks, we also need to outline how to do that. So, follow these steps.

  • Open the on-premise Exchange Server and download idFix;
  • Download Microsoft Azure AD Directory Connect;
  • Click on “Express Settings,” “Use express settings;”
  • Connect to Azure AD by adding your Office 365 tenant username and password;
  • Connect to AD DS by adding your administrator credentials;
  • Finish the synchronization process by clicking on “Install” in the final configuration step.

Step 2: Initiate the Hybrid Configuration Wizard

The second step is crucial for setting up an Office 365 hybrid Exchange environment. The step will walk you through the initiation process through the Exchange Admin Center. Follow these steps to do that:

  • Log in to the Exchange Admin Center;
  • From the list of options on the left side, click on “Hybrid” and select “Configure;”
  • Sign in to Office 365 as a global administrator;
  • The screen will redirect you to a website to download the hybrid configuration wizard tool. There will be a button that says “Click Here.” Click on it to initiate the installation of the tool;
  • Follow the installation wizard steps. Click on “Detect the optimal Exchange Server” when you reach the On-premises Exchange Server Organization screen;
  • Sign in as a global administrator and add your Office 365 account;
  • When you reach the “Hybrid Features” screen, select “Full Hybrid Configuration;”
  • Again, log in as Office 365 global admin. Click on the “Typical” configuration in the Hybrid Configuration screen and finish by adding your Fully Qualified Domain Name (FQDN).

Step 3: Moving Mailbox Servers

The following step will outline how to move mailboxes and mailbox servers from the on-premises Exchange to Office 365 Exchange Online. You will need to assign licenses to users of Office 365 to be able to move mailboxes through Exchange hybrid deployment. Here are the steps you need to take:

  • Go to the Exchange Admin Center and select “Recipients” from the list of available options on the left;
  • Select “Migration” from the list of options on the top;
  • Select the “+” sign and click on “Migrate to Exchange Online;”
  • You will be presented with several options. Choose “Remote Move Migration.” As you can see, the migration wizard tells you which Exchange version supports the right migration type. For example, if you have Exchange Server 2003, you can select “Staged Migration.” For now, we will go with “Remote Move Migration;”
  • Click on the “+” icon to add the desired mailboxes on the following screen. You can add however many mailboxes you want;
  • In the migration endpoint screen, select “Hybrid Migration Endpoint” and add the FQDN;
  • Give a name to the migration batch and click “Next.”

If you want to add more mailboxes, you will need to repeat the steps. You will also need to check if Office 365 tenants have client access to these mailboxes. To do that, type the following commands to Exchange Management Shell:

  • $office365= Get-Credentials
  • Connect-ExchangeOnline –Credentials $Office365 –ShowProgress $true
  • Get-MoveRequest –Identity ‘your username’
  • Get-MoveRequestStatistics -MoveRequestQueue “MBXDB02”

That concludes all the steps necessary to set up Office 365 hybrid Exchange environment. After the completion of the steps, you can now use Exchange Online and Exchange Servers the same way you would use Exchange on-premises. We do this to enable the functionalities of Exchange Online within Office 365. As you can see, Office 365 hybrid configuration can be complex. But the benefits of the hybrid environment greatly outweigh the time necessary to get it done.


We hope this guide explains the Office 365 hybrid configuration wizard for Exchange Online. The idea is to use Exchange Online in Office 365 instead of an on-premises server. With the tool, organizations have a centralized mail transport hub where users use Azure AD Connect for greater productivity.

With hybrid deployments of Exchange Online, you replace the on-premises environment with one on the cloud. You can add as many mailbox servers as you like, add however many Office 365 tenants’ access to said mailboxes, and create a reliable method for sharing mailboxes and calendars with Office 365 hybrid Exchange Online environment.