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Timoci TuisawauFlag for Fiji

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Synching internal AD with Azure for O365

I have an external domain that is being advertised via our zone files. For the setup of AAD Connect the connector to synch our internal AD with the Azure cloud, it is asking us to create either TXT or MX records on our zone file for our local domain i.e. ABC.local domain which our users exist on.

Do we need to create this under my external DNS, ABC.com.fj domain or do I create a seperate domain with a seperate DNS record for my ABC.local domain?
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I would like to ask a further question on this. Having used the ABC.com on AAD connect and have it verified. How do I then handle the users within my local AD i.e. they have abcnet.local loginsto the domain but would these logins be translated across to Azure so they would be able to practice a single sign on for O365 etc.?
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Thank you. Makes sense.....so just to summarise for UPN I would need to do something like this:

domain: ABC.com
Local domain: ABC.local

On AD within the my corporate environment users would have:

ABC.local

but would have the ABC.com as an option. This would mean that I would need to change them to ABC.com?
or would I need to create a ABC.local UPN on the AAD Synch and have user stay on ABC.local within the corporate network?

Your advice so far is much appreciated.

Thanks.