A Microsoft desktop and app virtualization service that runs on Azure. Previously known as Windows Virtual Desktop.
I don't think the successful 4768 on the domain controller proves that the Entra-joined AVD VM needs an AD computer account for this scenario. Microsoft Entra-joined devices can authenticate synchronized hybrid users to on-premises AD resources using Kerberos/NTLM even though the device itself isn't domain-joined.
Check these two things before changing the AVD join model.
First, check the username format. Microsoft specifically documents that applications authenticating users from an Entra-joined Windows device should use either the implicit UPN or the NT4 syntax with the AD DNS/FQDN domain, for example:
domain.local\sqladmin
A legacy NetBIOS form such as DOMAIN\sqladmin can fail on an Entra-joined device even when the account and password are correct.
From your examples, it looks like you've already tested the FQDN forms, so the next useful test is to separate secondary interactive logon from network authentication to SQL Server.
Try:
runas /user:[email protected] cmd.exe
and note whether Windows successfully creates the secondary process.
Then compare that with:
runas /netonly /user:domain.local\sqladmin "C:\Path\To\Ssms.exe"
/netonly is particularly relevant to your use case because the objective is for SSMS to access a remote SQL Server using the alternate AD credentials rather than necessarily creating a full local Windows logon for that AD identity.
Also, run the following from the normal hybrid user's AVD session:
dsregcmd /status
klist
In dsregcmd /status, confirm:
AzureAdJoined : YES
DomainJoined : NO
and inspect the SSO State, particularly whether OnPremTgt is available. OnPremTgt: YES, indicating that a Cloud Kerberos ticket for accessing on-premises resources is present for the signed-in user.
Also confirm that the session host has line of sight to the AD domain controllers, including DNS/DC discovery. Entra-joined AVD session hosts need connectivity to AD DS to access on-premises resources.
One other configuration point to check: if you're using Microsoft Entra SSO with Entra-joined AVD session hosts and still need access to on-premises resources, create a Kerberos server object for this scenario.
Therefore, avoid converting the AVD host to hybrid/domain join solely because RunAs currently fails. Entra-joined AVD with hybrid identities and access to on-premises resources is a supported architecture.
If runas /user: still produces 4625 while the DC simultaneously records a successful 4768, could you post the 4625 Status, SubStatus, and Logon Type, plus the account/domain fields from that event? Those values should tell us much more precisely whether Windows is rejecting the secondary local logon after the domain credentials have already been validated.
References:
SSO to on-premises resources from Microsoft Entra-joined devices
Microsoft Entra-joined AVD session hosts
Configure SSO for Azure Virtual Desktop
Troubleshoot device state with dsregcmd
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