Loading...

DLP policies will be able to block Copilot processing of sensitivity‑labeled files in all storage locations

DLP policies will be able to block Copilot processing of sensitivity‑labeled files in all storage locations

DLP policies will block Microsoft 365 Copilot from processing sensitivity-labeled Word, Excel, and PowerPoint files across all storage locations, including local devices. This rollout begins late March 2026, requires no policy changes, and ensures consistent DLP enforcement without altering Copilot capabilities. Introduction We’re expanding Microsoft Purview Data Loss Prevention (DLP) controls to provide broader governance for Microsoft 365 Copilot. With this update, DLP policies that prevent Copilot from processing content based on sensitivity labels will now apply to Word, Excel, and PowerPoint files regardless of where they are stored. This enhancement responds to customer feedback requesting more consistent protection coverage across local and cloud-based file locations. This feature is associated with Microsoft 365 Roadmap ID 557255. When this will happen General Availability (Worldwide and GCC): Rollout will begin in late March 2026 and is expected to complete by late April 2026. How this affects your organization Who is affected Organizations using Microsoft Purview DLP to restrict Copilot processing of sensitivity-labeled content Admins who manage Purview DLP policies Users working with Microsoft 365 Copilot in Word, Excel, or PowerPoint What will happen DLP policies that restrict Copilot from processing sensitivity‑labeled files will apply to Word, Excel, and PowerPoint files in all storage locations, including: SharePoint OneDrive for Business Local device storage Other storage locations accessible to Office apps When a DLP policy blocks Copilot processing, Copilot will not process the file’s content in Word, Excel, or PowerPoint. Existing DLP policies will continue to function normally; no policy migration or reconfiguration is required. The feature will be on by default for tenants with relevant DLP rules configured. Users will see consistent DLP enforcement when invoking Copilot in supported Microsoft 365 apps. Implementation detail: What you can do to prepare No action is required to enable this feature. This update does not modify Copilot capabilities. Instead, Office clients and AugLoop have been enhanced so AugLoop can read a file’s sensitivity label directly from the client. Today, AugLoop retrieves the label by calling Microsoft Graph using the file’s SharePoint or OneDrive URL, which limits DLP enforcement to files stored in OneDrive and SharePoint. By […]

The post DLP policies will be able to block Copilot processing of sensitivity‑labeled files in all storage locations appeared first on M365 Admin.

Published on:

Learn more
Need help with this product?

We can help you with DLP policies will be able to block Copilot processing of sensitivity‑labeled files in all storage locations

If you want help implementing, troubleshooting, or improving this product, contact us and we’ll point you in the right direction.

M365 Admin
M365 Admin

by João Ferreira

Share post:

Related posts

Microsoft 365: [Education] Microsoft Learning Zone – Improve Lesson Insights

See where your class is struggling and which students need support, with lesson-level results for every student. Aggregated responses show the...

2 days ago

Dynamics 365 Project Operations: Invoice usability enhancements

When billing teams review an invoice, they need to see where it stands, which transactions it includes, and what’s still waiting to be b...

2 days ago

Dynamics 365 Commerce: Unified Pricing Management – Require manager approval for price overrides and manual discounts that exceed margin limits

Retailers can protect their profitability without slowing down store operations. Sales associates can still adjust prices to close a sale. Any...

2 days ago

Dynamics 365 Finance: Faster cube data loading with optimized dataflows

The Matrix visual now provides clearer control over how zero and blank values are handled during planning. Users can explicitly save 0 as a pl...

2 days ago

Dynamics 365 Commerce: Unified Pricing Management – Attribute-based margin thresholds and tiers for approvals and reporting

Pricing managers can set margin controls that match how the business actually sells, instead of one threshold for everything. Each product, ch...

2 days ago

Microsoft SharePoint Online and OneDrive for the web: Updated search experience with Copilot Search

SharePoint Online and OneDrive on the web are updating to a unified Copilot Search experience with natural-language prompts, AI summaries, and...

2 days ago

Microsoft Teams: Automatically add tag members to channels with Workflows

Microsoft Teams will introduce a Workflows app template to automatically add users to channels when they are added to a team tag. This optiona...

2 days ago

Microsoft SharePoint: Data access governance report for group permissions

Microsoft SharePoint is introducing a Data access governance report in the admin center to help administrators identify sites accessible to sp...

2 days ago

Action required: Exchange Online Admin API MailboxFolderPermission response update

Microsoft will update the Exchange Online Admin API v2.0 MailboxFolderPermission endpoint to return the User property as a structured object w...

2 days ago

Microsoft Planner: Planner capabilities in Copilot Cowork through the Planner Plugin

The Planner Plugin integrates Microsoft Planner with Copilot Cowork, enabling task prioritization, completion assistance, plan creation, visua...

2 days ago

Newsletter

Get the latest Dynamics 365 and Power Platform content in your inbox

A curated digest of community blogs, product news, videos, and podcasts — delivered without the noise.

Weekly updates Unsubscribe anytime Fresh community picks
We use your email only for the newsletter and you can unsubscribe at any time.
By subscribing, you agree to the privacy policy.