Hello Nazim,
Thank you for posting your question on the Microsoft Windows Forum!
Thank you for the thorough analysis. Honestly, you've already done the most important troubleshooting, and your packet captures provide a very useful clue.
The key finding is this:
DHCP Request:
Option 81 present
Flags = 0x00
(S=0: client updates A, server updates PTR)
DHCP ACK:
No Option 81 returned
At the same time, you've proven that:
- The reverse zone is healthy.
- Secure updates work.
- PTR registration succeeds immediately when the same VM is configured with a static IP.
- The client never sends a PTR dynamic update while operating with an Azure DHCP-assigned address.
That strongly suggests the issue is not DNS permissions, Kerberos, zone configuration, or reverse-zone design.
What Microsoft Documents
Microsoft's Azure documentation states that Azure DHCP servers do not have the credentials necessary to directly register records in your custom DNS servers and that when using custom DNS servers, dynamic registration behavior differs from traditional Windows DHCP environments. Use dynamic DNS to register hostnames in your own DNS server explains that Azure DHCP does not directly perform registrations in customer-managed DNS zones. [learn.microsoft.com]
Microsoft also documents Windows DHCP client and DHCP Option 81 behavior for DDNS ownership between client and server. When DHCP is expected to perform part of the registration process, Option 81 negotiations become relevant. [github.com]
My Assessment
Based on the evidence presented, I do not think you're dealing with:
- Reverse zone permissions
- AD-integrated DNS configuration
- Secure dynamic update failures
- Client inability to perform PTR registration
You have already proven those work with a static IP.
The more interesting question is whether the combination of:
Azure-provided DHCP
+
No DHCP Option 81 response
+
Windows 11 build 26200
results in Windows never transitioning into the expected PTR self-registration path.
I am not currently aware of Microsoft documentation stating that Azure DHCP supports DNS dynamic updates to custom AD DNS servers or performs PTR registration on behalf of Azure VMs using customer-managed DNS. In fact, Microsoft's Azure DDNS guidance points administrators toward alternative registration mechanisms when Azure-provided DHCP is involved. [learn.microsoft.com]
Recommendation
At this point, rather than investigating DNS configuration further, I would focus on validating whether this behavior is:
- Specific to Windows 11 build 26200.
- Reproducible on another supported Windows build in Azure.
- Consistent across multiple Azure-hosted DHCP-assigned VMs using custom AD DNS.
You've already narrowed this down far enough that it looks more like a Windows/Azure DHCP interaction question than a DNS administration issue.
References
- Use dynamic DNS to register hostnames in your own DNS server [learn.microsoft.com]
- Client DDNS updates and DHCP Option 81 [github.com]
I hope this answer has brought you useful information. If so, please click on "Accept Answer" and consider upvoting it. Doing so helps other community members identify useful solutions to similar issues.