License & Subscription Issues

Understanding Azure AD Application Proxy License Requirements

Algirdas JasaitisAlgirdas Jasaitis Nov 3, 2026 869 views

Question details

The user needs clarification on whether an Azure AD Premium license is required for all users accessing an application via Azure AD Application Proxy, or just for the administrator configuring it.

Understanding Azure AD Application Proxy License Requirements
Product
Azure AD Application Proxy
Device & OS
not provided
Scenario
Determining accurate enterprise licensing needs for deploying and accessing applications published through Azure AD Application Proxy.
Observed behavior
There is uncertainty regarding which users (administrators vs. end-users) require an Azure AD Premium P1 or P2 license to remain compliant.
Before you start

Ensure you have access to your Microsoft Entra ID (formerly Azure AD) admin center to review your organization's current subscription tier and available user licenses.

Solution 1Recommended

Identify and Assign Azure AD Premium Licenses for App Proxy Users

Both administrators and end-users accessing the Application Proxy require proper licensing. Assigning Azure AD Premium P1 or P2 licenses to these users is necessary for compliance.

Microsoft's licensing model for Azure AD Application Proxy requires that any user accessing an application published through the proxy must be licensed with Azure AD Premium P1 or P2. It is not sufficient for only the administrator configuring the connector to hold the license.

1
Verify current subscription

Log in to the Microsoft Entra admin center, navigate to 'Billing', and select 'Licenses' to check if you have Premium P1 or P2 licenses available.

2
Assign licenses to users

Go to 'Users', select the end-users who will be accessing the published applications, and assign them the required Premium P1 or P2 license under the 'Assignments' tab.

3
Review application proxy configuration

Ensure your Application Proxy connectors are actively running and that the enterprise application is assigned only to licensed users or groups in the application's properties.

Identify and Assign Azure AD Premium Licenses for App Proxy Users
License enforcement: Microsoft regularly updates licensing terms; always consult the latest official Microsoft licensing documentation to ensure full compliance for both administrators and end-users.
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Frequently Asked Questions

Do guest users require an Azure AD Premium license to use Application Proxy?

Yes, external or guest users accessing applications via Azure AD Application Proxy must be covered by External Identities licensing, which usually follows the Monthly Active Users (MAU) billing model linked to a Premium tier.

Is an Azure AD Premium license required for the server hosting the connector?

No, the on-premises server hosting the Application Proxy connector does not need a specific Azure AD license itself. However, the administrator configuring the connector and the end-users accessing the published apps must hold valid Azure AD Premium P1 or P2 licenses.

What happens if a user accesses an Application Proxy app without a P1 or P2 license?

Accessing Azure AD Premium features without the correct license is a violation of Microsoft's licensing terms. Organizations may face compliance issues and financial penalties during Microsoft license audits if users are found to be improperly licensed.