April 16, 2025

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Defender XDR: Critical Asset and Shadow IT Containment

Defender XDR: Critical Asset and Shadow IT Containment

Introduction:

Microsoft Defender XDR continues to improve its Automatic Attack Disruption capabilities, helping organizations contain attacks earlier and more precisely.

The latest update brings two important new features:

  • Granular containment of critical assets

  • Containment of IP addresses linked to unmanaged devices (Shadow IT)

This post provides a quick overview of the changes, how they work, and what you should know before enabling them.


Overview: Why Automatic Attack Disruption matters

Attackers constantly evolve — using lateral movement techniques, privilege escalation, and exploiting unmanaged assets.

Traditional containment strategies often required full device isolation, which could interrupt business operations, especially when critical infrastructure was involved.

Microsoft’s approach improves this by introducing targeted containment:

  • Limiting the attacker’s actions without fully disconnecting the device

  • Minimizing the impact on operational continuity

  • Automatically identifying and blocking risky unmanaged devices


What’s New?

Granular Containment of Critical Assets

Scope:

Applies to Domain Controllers, DNS servers, DHCP servers, and other critical systems.

How it works:

Instead of full isolation, Defender for Endpoint intelligently restricts only the network functionalities and communication channels typically abused during attacks.

Impact:

  • Attackers lose the ability to move laterally or escalate privileges.

  • Essential network services remain operational.

  • Business continuity is preserved even during active incidents.

Containment of IP addresses from Unmanaged Devices

Scope:

Targets shadow IT, BYOD, and any unmanaged devices that could be leveraged in lateral movement.

How it works:

When malicious activity from an unknown or unmanaged device is detected, its associated IP address is automatically contained, blocking it from interacting with managed assets.


Impact:

  • Reduces risks associated with devices outside your management scope.

  • Prevents early-stage attacks from escalating through weak points in the network.


Important Technical Considerations

Prerequisites

  • Licensing:

    Requires M365 E5, Defender for Endpoint Plan 2, or equivalent security licensing (full list available here).

  • Deployment:

    Defender for Endpoint device discovery must be set to Standard Discovery to enable device-level containment.

  • Automation settings:

    Devices should be assigned to groups with Full automation enabled under Defender portal settings to allow automatic response without manual approval.

  • Minimum client version:

    Endpoint devices must have Sense Agent version v10.8470 or later for user containment actions.

  • Permissions:

    Configuration changes require either Global Administrator or Security Administrator role in Entra ID or M365 Admin Center.


Managing Containment Actions

Containment actions are fully visible and manageable:

  • Incident Graph:

    Contained devices and suspended user accounts are labeled clearly. Release actions can be performed manually after risk mitigation.

  • Action Center:

    All disruption actions are tracked centrally at Action Center.

  • Advanced Hunting:

    You can track containment events via KQL queries, e.g.,

DeviceEvents
| where ActionType contains "ContainedDevice"


Tracking Disabled Accounts After Attack Disruption:

  • Attack disruption in Microsoft Defender XDR uses the remediation actions from Defender for Identity to disable compromised accounts.

  • By default, the Defender for Identity sensor runs these actions under the LocalSystem account on the domain controller.

  • The following query finds user accounts that were disabled, either manually or by automatic attack disruption:


let AllDomainControllers =
DeviceNetworkEvents
| where TimeGenerated > ago(7d)
| where LocalPort == 88
| where LocalIPType == "FourToSixMapping"
| extend DCDevicename = tostring(split(DeviceName,".")[0])
| distinct DCDevicename;
IdentityDirectoryEvents
| where TimeGenerated > ago(90d)
| where ActionType == "Account disabled"
| where Application == "Active Directory"
| extend ACTOR_DEVICE = tolower(tostring(AdditionalFields.["ACTOR.DEVICE"]))
| where isnotempty( ACTOR_DEVICE)
| where ACTOR_DEVICE in (AllDomainControllers)
| project TimeGenerated, TargetAccountUpn, ACTOR_DEVICE

Manual Exclusions:

  • IPs or subnets can be manually excluded via Defender XDR portal if needed — but this should be used cautiously.


Summary:

This update strengthens Defender XDR’s ability to:

  • Contain attacks earlier in the kill chain.

  • Minimize disruption to critical infrastructure.

  • Cover unmanaged assets automatically.

Proper deployment, correct licensing, and full automation policies are key to making the most out of this capability.


Full documentation and setup instructions:

https://techcommunity.microsoft.com/blog/MicrosoftThreatProtectionBlog/automatic-attack-disruption-enhanced-containment-for-critical-assets-and-shadow-/4402157

https://learn.microsoft.com/en-gb/defender-xdr/automatic-attack-disruption-exclusions