Hi @Jackson Harris,
Welcome to the Microsoft Q&A Platform! Thank you for asking your question here.
Using a traditional Active Directory Domain Controller (AD DC) can provide a more comprehensive solution for scenarios that require features not fully supported by Azure Active Directory Domain Services (Azure AD DS). Azure Virtual Desktop supports hybrid identities through Microsoft Entra ID, including identities that are federated by using AD FS. You can manage these user identities in AD DS and sync them to Microsoft Entra ID by using Microsoft Entra Connect. You can also use Microsoft Entra ID to manage these identities and sync them to AD DS.
Microsoft Entra Connect or Microsoft Entra Connect cloud sync synchronize your on-premises identity information to the cloud. As part of the synchronization process, on-premises user and domain information is synchronized to Microsoft Entra ID.
When accessing Azure Virtual Desktop resources, there are three separate authentication phases:
- Cloud service authentication: Authenticating to the Azure Virtual Desktop service, which includes subscribing to resources and authenticating to the Gateway, is with Microsoft Entra ID.
- Remote session authentication: Authenticating to the remote VM. There are multiple ways to authenticate to the remote session, including the recommended single sign-on (SSO).
- In-session authentication: Authenticating to applications and web sites within the remote session.
SSO allows the connection to skip the session host credential prompt and automatically sign the user in to Windows through Microsoft Entra authentication. For session hosts that are Microsoft Entra joined, or Microsoft Entra hybrid joined, it's recommended to enable SSO using Microsoft Entra authentication.
How to set up a FSLogix profile container with Azure Files when your session host virtual machines (VMs) are joined to an Active Directory Domain Services (AD DS)-https://learn.microsoft.com/en-us/fslogix/how-to-configure-profile-container-azure-files-active-directory?tabs=adds
Install FSLogix Applications- https://learn.microsoft.com/en-us/fslogix/how-to-install-fslogix
If you have any further queries, do let us know.