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Related article:
Outlook Something Went Wrong and Outlook Can’t Open
(This could be related to a cached identity and outlook uses the wrong Autodiscover record, for example it tries to authenticate with an old or cached exchange on prem user)

Microsoft Office 365 is discontinuing basic authentication and as a result some users’ Outlooks will have issues with signing in.

Outlook Legacy sign in prompt (only appears if user is authenticating/trying to authenticate with BASIC AUTHENTICATION still or if they are authenticating on an on-premise Exchange server)

Expected modern sign in prompt for O365 online in Outlook Desktop App:

Possible causes:

• Basic Authentication is still enabled for the tenant 365 account:

◦ In the Microsoft 365 admin center at https://admin.microsoft.com go to Settings > Org Settings > Modern Authentication. In the Modern authentication flyout that appears, you can identify whether Basic or modern auth is used and follow prompts to enable Modern Auth.
▪ https://learn.microsoft.com/en-us/exchange/clients-and-mobile-in-exchange-online/disable-basic-authentication-in-exchange-online

• You are running Outlook 2013 or earlier:

◦ You can either upgrade to a later version of Outlook (Office Apps Suite) OR
◦ Add these registry keys to force/enable modern auth for outlook 2013:

▪ HKEY_CURRENT_USER\Software\Microsoft\Exchange\
• AlwaysUseMSOAuthForAutoDiscover REG_DWORD 1
▪ HKEY_CURRENT_USER\Software\Microsoft\Office\15.0\Common\Identity\
• EnableADAL REG_DWORD 1
▪ HKEY_CURRENT_USER\Software\Microsoft\Office\15.0\Common\Identity\
• Version REG_DWORD 1

https://learn.microsoft.com/en-us/microsoft-365/admin/security-and-compliance/enable-modern-authentication?view=o365-worldwide

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