Introducing dynamic tool discovery for MCP-based agents and connectors in Microsoft 365 Copilot

Microsoft 365 Copilot introduces dynamic tool discovery for MCP-based declarative agents and federated connectors, enabling runtime tool updates without republishing. Rollout completes by July 2026. Admins can manage and audit these tools via Microsoft 365 admin center and Purview, with no changes to data compliance or security controls. Introduction We’re excited to announce dynamic tool discovery, a new capability for declarative agents and federated Copilot connectors in Microsoft 365 Copilot that are built on the Model Context Protocol (MCP). Today, when an MCP server is used by a declarative agent action or a federated Copilot connector, the tools it exposes are imported and packaged into the consuming agent or connector at publish time. Any change to that tool surface, such as adding a new tool, removing a deprecated one, or updating a tool’s schema or description, requires the agent or connector to be repackaged, re-validated, and republished before users see the change. With dynamic tool discovery, the agent or connector resolves its available tools at runtime, directly from the MCP server. This lets users access the latest capabilities of an MCP server in near real time, without waiting on a republish cycle. Dynamic tool discovery is starting with declarative agents (DAs) that use MCP server-based actions, and will soon be available for federated Copilot connectors (FCCs), including both Microsoft-published and custom connectors. When this will happen Rollout will happen in two waves: – **Declarative agents (MCP server-based actions):** rollout is expected to complete by end of June 2026. – **Federated Copilot connectors (Microsoft-published and custom):** rollout is expected in July 2026. Public documentation will be updated around the same time. How this will affect your organization Who is affected? Organizations with Microsoft 365 Copilot licenses where Microsoft-published declarative agents that use MCP server-based actions, or federated Copilot connectors, are enabled. What will happen? Microsoft-published declarative agents (and, in the next wave, federated Copilot connectors) that use MCP servers will begin resolving their tool list from the MCP server at runtime, instead of from the tool list captured at publish time. End users will see new tool capabilities surfaced shortly after […]

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