Whats New in Microsoft 365 | October 2026 Updates
Nick Ross ·
Below are all of the latest feature updates coming to Microsoft 365.
Automated Security Assessments and Policy Management
CloudCapsule is a tool I built purpose built for MSPs looking to scale their security practice on Microsoft 365. Scans of tenants take on average 60 seconds where we collect over 250 data points. We now provide remediation and policy management capabilities, allowing you to deploy fixes right from within our portal.
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Teams Updates
1. Report guest invitations for security concerns
New Feature
How this will affect your organization
Microsoft Teams will enable users to report guest invitations for security concerns directly from Teams.
When will this happen: early November 2026 and expect to complete by mid-November 2026.
2. Phishing detection for messaging
New Feature
How this will affect your organization
Microsoft Teams is introducing AI-powered, context-aware phishing detection to help identify phishing, social engineering, impersonation attempts, and deceptive intent
When will this happen: early December 2026 and expected to complete by mid-December 2026
3. Initiate side conversations within the meeting chat window
New Feature
How this will affect your organization
Microsoft Teams will enable meeting participants to start and continue one-to-one or small-group conversations directly from the meeting chat experience
When will this happen: early January 2027 and expect to complete in late January 2027.
4. Two presenters can share their screens or windows simultaneously in meetings
New Feature
How this will affect your organization
Two presenters can share a screen or window at the same time in a Teams meeting.
When will this happen: late November 2026 and expect to complete by mid-December 2026.
5. Improved file sharing experience in external chats
New Feature
How this will affect your organization
We’re improving the file-sharing experience in Microsoft Teams external (federated) chats by making the Attach file (paperclip) and drag-and-drop experiences available by default.
When will this happen: TBD
6. Customize file extensions blocked by Weaponizable File Protection
New Feature
How this will affect your organization
Admins will be able to customize which file extensions are blocked in Teams based on their organization’s security needs or continue using the Microsoft-recommended default list.
When will this happen: early November 2026 and expected to complete by mid-November 2026
7. Upcoming change to voicemail message delivery by email
New Feature
How this will affect your organization
Microsoft Teams will change voicemail email delivery by early March 2027, moving caller info from the email From field to the Subject line and allowing organizations to use their own domains for sending.
When will this happen: early March 2027 and complete by late June 2027.
8. Teams Phone Agent is rolling out to general availability
New Feature
How this will affect your organization
Teams Phone Agent is an AI-powered calling solution that answers incoming calls, assists with supported customer questions and appointment-booking scenarios, and routes callers to an appropriate human contact along with AI-generated conversation notes when additional assistance is needed.
When will this happen: early November 2026 and expected to complete by mid-November 2026
Microsoft Outlook/Exchange
1. Sending from Aliases
New Feature
How this will affect your organization
Sending from Aliases is now generally available in Exchange Online, allowing users to send emails from any mailbox alias. Admins can enable it via PowerShell or Exchange Admin Center.
When will this happen: GA
2. Reply With a Template in Rules
New Feature
How this will affect your organization
Users of new Outlook for Windows and Outlook on the web will be able to create inbox rules that automatically reply to incoming messages using a saved template
When will this happen: early December 2026 and expect to complete by late December 2026.
3. New Outlook for Windows: All Accounts view brings email into a single inbox view
New Feature
How this will affect your organization
The All Accounts view, also known as Unified Inbox, lets users see email from multiple connected accounts in a single inbox view in the new Outlook for Windows without merging their mailboxes.
When will this happen: late September 2026 and expect to complete by late November 2026 (previously late October).
Microsoft 365 Apps
1. Microsoft 365: Targeted Release retirement
New Feature
How this will affect your organization
Targeted release for Microsoft 365 services will be retiring in January 2027 as Microsoft 365 transitions to three release options: Frontier, Standard release, and Deferred release.
Instead of looking in different places for previews, admins use one program and one setting to give the users they choose early access across Microsoft 365.
Microsoft Entra
1. New Conditional Access policy plans in Microsoft Entra
New Feature
How this will affect your organization
Microsoft Entra Conditional Access policy plans group related rules under shared assignments and conditions. Administrators can define common targeting and exclusions once, then configure each rule for a specific scenario.
When will this happen: Public Preview
2. Choose your own telephony provider for SMS and voice authentication
New Feature
How this will affect your organization
Starting October 30, 2026, Microsoft Entra ID will make Choose Your Own Telephony Provider (CYOT) generally available. CYOT enables organizations to use a supported third-party telecommunications provider for SMS and voice authentication.
Learn More: https://learn.microsoft.com/en-us/entra/identity/authentication/concept-phone-providers (opens in new tab)
3. Review who can create agents in Microsoft Entra
New Feature
How this will affect your organization
Microsoft Entra is changing who can create agent blueprints by default. Starting November 4, default users will be able to create new agent blueprints unless an administrator turns off Users can create agent blueprints.
4. Microsoft Authenticator: Usability improvements for iOS and Android
New Feature
How this will affect your organization
These updates include a refreshed home experience, clearer guidance for accounts that need to be restored, improvements to restoration and sign-in flows, and additional prompts designed to help keep Authenticator working reliably
When will this happen: October 2026 and expected to complete in November 2026
5. Entra Agent ID lifecycle policies
New Feature
How this will affect your organization
To ensure the security and manageability of agent identities for Microsoft customers, Microsoft Entra Agent ID provides a default inactivity policy to all tenants. This policy identifies inactive agent identities, notifies relevant users, and then proceeds to disable the identity if no new activity is detected.
Full Article: https://learn.microsoft.com/en-us/entra/id-governance/agent-default-inactivity-policy (opens in new tab)
When will this happen: Public Preview
Microsoft Copilot
1. Copilot Code is rolling out in Frontier
New Feature
How this will affect your organization
Copilot Code is an AI-powered coding experience in Microsoft Copilot that helps people turn ideas into trackers, dashboards, apps, and other solutions using natural language. Work IQ grounds what they build in emails, meetings, documents, chats, and connected data.
When this will happen late October 2026.
2. Projects in Copilot
New Feature
How this will affect your organization
Projects in Copilot unify related chats, Cowork tasks, files, and context in one place, reducing repeated explanations.
When this will happen late October 2026 and expect to complete by mid-November 2026. (Frontier)
3. Microsoft Graph APIs for Copilot cost management
New Feature
How this will affect your organization
Microsoft is introducing Microsoft Graph APIs for Copilot cost management, enabling programmatic control of credit spending policies, balance monitoring, and credit requests.
Official Docs: https://learn.microsoft.com/en-us/microsoft-365/copilot/extensibility/api/admin-settings/cost-management/overview (opens in new tab)
When will this happen? beta endpoint in mid-October 2026.
4. Enhanced M365 Copilot Memory - Copilot is now personalized with work data
New Feature
How this will affect your organization
Copilot now uses inferences Microsoft 365 data as context to provide more personalized responses to your work.
When will this happen? early October 2026 and expect to complete by end of November 2026 (previously late October).
5. UBB models in Chat and Word, Excel, and PowerPoint via the model selector
New Feature
How this will affect your organization
Usage-based billing (UBB) models, including GPT-6 Astra and Claude Fable 5.1, will be available in Microsoft Copilot Chat and Copilot in Word, Excel, and PowerPoint starting November 2026.
When will this happen? early November 2026 and expected to complete by mid-November 2026
6. Skills in Copilot Chat
New Feature
How this will affect your organization
Microsoft 365 Copilot Chat now supports customizable skills for task-specific instructions, usable by end users and deployable by admins. Skills integrate with plugins, are discoverable in the Agent Store, and work across Copilot Chat and Cowork.
When will this happen? October 2026 and expect to complete by mid-November 2026.
7. 'Record A Skill' Capability in PowerPoint Copilot
New Feature
How this will affect your organization
This capability helps users create reusable skills by recording actions in PowerPoint, so they can more easily repeat common PowerPoint tasks with Copilot.
When will this happen? early October 2026 and is expected to complete in early October 2026.
8. Create Interactive Slides
New Feature
How this will affect your organization
With the create interactive slide skill, Copilot generates interactive slides from a simple prompt or existing content. Whether you're highlighting insights from a dashboard, explaining a business process, walking through a timeline, or comparing options, interactive slides help make information accessible and more memorable.
When will this happen? end of October 2026.
9. Cowork: Expanded plugins and role-based skills
New Feature
How this will affect your organization
New Sales, Service, Education, and Legal plugins for Cowork package the business processes these teams rely on into skills, so Cowork starts with pre-built workflows for those roles instead of a blank prompt.
When will this happen? GA
10. Introducing Microsoft Copilot for legal
New Feature
How this will affect your organization
Legal teams rely on specialized sources and systems beyond Microsoft 365. New partner-built plugins bring them into Copilot, spanning legal research; document, matter, and transaction management; agreements and electronic signature; legal AI; and e-discovery. Starting today, these partner-built legal plugins are beginning to roll out through the Microsoft plugin registry, with additional plugins becoming available over time.
When will this happen? GA
Microsoft Admin
1. Now generally available: Discover local AI agents with Microsoft Defender
New Feature
How this will affect your organization
Today, discovery of AI agents and their configured MCP servers on Windows and macOS is generally available, with discovery coverage expanded to more than 50 supported agents and MCP servers.
When will this happen? mid-September 2026 and expected to complete by late September 2026
2. Microsoft Defender XDR: DLP alerts will be set as behaviors by default
Update
How this will affect your organization
Microsoft Defender XDR will set Microsoft Purview DLP alerts as behaviors by default starting October 12, 2026, reducing alert volume while keeping DLP data accessible in Advanced Hunting and Purview.
Administrators can disable the rule if they prefer DLP events to continue generating standard alerts and appearing in the incident queues in Microsoft Defender XDR portal.
3. Integrated Security Operations Center in Microsoft Defender
New Feature
How this will affect your organization
Public preview of Integrated Security Operations Center (ISOC) in Microsoft Defender. The ISOC benefit enables eligible Microsoft Defender Suite, Microsoft 365 E5 and E7 customers to unlock more value from their existing investments by bringing XDR, SIEM, threat intelligence, automation, and AI together in Microsoft Defender.
When will this happen: September 23rd Public Preview
Conclusion
I hope this overview of updates provided some targeted guidance to help be more proactive with Microsoft across your customers. If there is additional information that you would like to see in this content that would be more helpful or if you would like access to an editable version of this document, please email me at msp4msps@tminus365.com.
Thanks,
Nick
Microsoft ships changes every month. Know what they did to your tenant.
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