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Conditional Access Policies | Sourcepass

Written by Alex Davis | Aug 25, 2025

Phishing attacks are growing more sophisticated, often bypassing traditional multi-factor authentication (MFA) methods such as SMS or app-based codes. To counter these threats, organizations need more than strong passwords and basic MFA. Microsoft 365 Conditional Access policies provide policy-driven controls that determine who can access resources, under what conditions, and with what security requirements. When combined with phishing-resistant MFA and Microsoft Defender for 365, conditional access becomes a powerful safeguard against modern phishing techniques.

 

What Are Conditional Access Policies?

Conditional access policies act as gatekeepers for Microsoft 365 resources. Instead of granting access based solely on username and password, policies evaluate multiple factors—including user identity, device compliance, location, and risk signals—before allowing or blocking access.

This ensures that only trusted users on secure devices can access sensitive applications and data.

 

Why Conditional Access Matters in Modern Phishing Defense

Attackers often steal tokens, intercept one-time codes, or hijack sessions after phishing attempts. Conditional access provides a critical layer of protection by:

  • Requiring Phishing-Resistant MFA
    Users must authenticate with secure methods such as FIDO2 security keys, YubiKeys, Windows Hello for Business, or passkeys. These methods prevent attackers from reusing stolen credentials or tokens.

  • Enforcing Compliant Devices
    Policies can restrict access to managed or compliant devices only. Unmanaged or outdated devices are automatically blocked, reducing exposure to compromised endpoints.

  • Blocking Risky Sign-Ins
    Sign-ins from unfamiliar locations, suspicious IPs, or risky devices can be challenged with step-up authentication or blocked outright.

  • Protecting High-Value Applications
    Conditional access allows organizations to restrict access to sensitive apps (e.g., financial systems, HR data, or executive communications) with stricter policies.

 

Best Practices for Implementing Conditional Access

To maximize the effectiveness of conditional access in Microsoft 365:

  1. Start with High-Sensitivity Accounts
    Apply strict conditional access policies to administrators, executives, and finance teams first, as these accounts are prime targets for attackers.

  2. Use a Phased Rollout
    Introduce policies gradually to avoid accidental lockouts. Test with small groups, then expand organization-wide.

  3. Combine with Microsoft Defender for 365
    Leverage risk-based conditional access that integrates with Defender signals to automatically detect and respond to suspicious activity.

  4. Require Device Compliance
    Ensure only devices that meet your organization’s security baseline—such as up-to-date patches, antivirus, and encryption—are allowed access.

  5. Monitor and Adjust Continuously
    Regularly review sign-in logs and policy impact reports in Microsoft Entra to refine protections as threats evolve.

 

Real-World Impact of Conditional Access

Organizations that adopt conditional access see measurable improvements in security posture. For example:

  • SMBs moving from SMS MFA to FIDO2 enforced through conditional access have eliminated successful phishing-based account takeovers.

  • Enterprises using Defender-integrated conditional access report faster detection and automated remediation of suspicious sign-ins.

By enforcing policies at the access layer, businesses significantly reduce the risk of credential misuse, token theft, and phishing success.

 

Conclusion

Passwords and basic MFA are no longer enough to protect against modern phishing. Conditional access policies in Microsoft 365 provide a policy-level shield, ensuring that only trusted users on compliant devices with phishing-resistant MFA can access your environment.

When implemented alongside Microsoft Defender for 365, conditional access becomes a secret weapon that stops phishing attacks before they succeed.