How Does AI Change the Shared Responsibility Model?
October 15, 2026
Protecting Against AiTM Attacks: Is Your Microsoft Environment at Risk?
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5 min.
The identity threat landscape has shifted considerably over the past few years. Attackers have steadily moved toward more sophisticated techniques and Adversary-in-the-Middle (AiTM) phishing is near the top of that list. Microsoft observed a 146% rise in AiTM attacks in 2024 and the trend has continued into 2026.
TL;DR – If your Microsoft 365 environment relies on traditional multifactor authentication (MFA) without phishing-resistant authentication and or layered Conditional Access policies, AiTM attacks can bypass your defenses and hijack active sessions in real time.
Key Takeaways:
- AiTM phishing has been commoditized through Phishing-as-a-Service platforms. AI-generated lures have eliminated the visual cues that users once relied on to identify phishing attempts.
- Phishing-resistant authentication methods (FIDO2, passkeys, Windows Hello for Business, certificate-based authentication) are the only category of MFA that AiTM proxies cannot relay, making them the most critical control to prioritize.
- Deploying these controls in production environments with hybrid identity, legacy applications and third-party integrations requires deliberate sequencing and real-world risk assessment, not just baseline compliance.
A significant driver of AiTM growth is the Phishing-as-a-Service ecosystem. Platforms like Tycoon2FA have industrialized AiTM attacks. A threat actor with minimal technical skill can rent a fully functional proxy-based phishing kit, for as little as $120.
The result is a category of attack that was once the domain of sophisticated threat actors and is now widely accessible.
AI is accelerating this trend further. Phishing lures that used to be easy to spot, including awkward phrasing, odd formatting, generic greetings have all but vanished. Lures are increasingly generated by AI tools that produce polished, personalized and contextually convincing content at scale.
Research has found that AI-generated phishing attacks are becoming increasingly common. For organizations running Microsoft 365, this is a practical problem worth understanding.
What is AiTM and How Does It Work?
AiTM attacks build on the foundation of traditional man-in-the-middle tactics. This type of attack operates across multiple communication layers, from the network and transport layers all the way up to the application layer, relaying traffic in real time. Once positioned, the attacker actively intercepts the exchange between the victim and the legitimate service.
A user clicks a link in a phishing email and lands on an attacker-controlled reverse proxy. This proxy silently relays everything to the real login server.
The user enters their credentials and completes their multi-factor authentication (MFA) challenge, if applicable. To the user, everything looks normal, even the sign-in page will display their organization’s branding.
At the end of the authentication flow, once the server is satisfied, it issues a session cookie. The attacker’s proxy captures that token and injects it into their own browser.
They now hold a valid, active session and can navigate everywhere the user can. Traditional MFA methods like Short Message Service (SMS) codes and number matching cannot prevent this.
What Native Microsoft 365 Controls Can Help Address AiTM Risk?
Microsoft 365 includes several controls that directly address AiTM risk. The most effective are phishing-resistant authentication methods, specifically Fast Identity Online 2 (FIDO2) security keys, passkeys, Windows Hello for Business and certificate-based authentication.
These methods are cryptographically bound to the legitimate domain, meaning a proxy cannot relay them. They are the only authentication methods that can stop AiTM if setup properly.
Beyond phishing-resistant authentication methods, Conditional Access is one of the most powerful tools available for reducing AiTM risk. Requiring compliant devices, restricting access to trusted locations and enforcing risk-based policies through Entra ID Protection creates a layered defense. An attacker would need to satisfy all of these conditions at once.
Even if a session cookie is stolen, with the proper setup these controls could stop that stolen session from being used.
These controls are well-designed and, when configured correctly, meaningfully reduce AiTM risk. The operational challenge for most organizations is getting from where they are today to a state where these controls are deployed, tuned and maintained without disrupting the business in the process.
Where to Focus Your Efforts to Reduce Risk
Microsoft 365 and Entra ID environments accumulate complexity quickly. Conditional Access policies layer on top of each other. Defender configurations drift from their original intent. Permissions granted for a specific project persist long after the project ends. Staying on top of it requires deliberate, recurring attention in three areas.
Start with Strategy
Passwordless authentication, Conditional Access architecture and zero trust roadmaps each touch identity, device trust, network segmentation and application access simultaneously. The challenge is rarely understanding what the target state looks like.
It’s sequencing the work across dependencies that already exist in production, with the budget and staffing currently available, without stalling the initiatives that are already in flight. Without a solid strategy serving as a foundation, you run the risk of introducing unintended gaps where an attacker can gain entry.
Assess Against Real-world Risk, Not Just Baselines
Recommended security baselines for Microsoft 365 and Entra ID are a reasonable starting point. The more valuable exercise is mapping your current configuration against attack patterns relevant to your organization. Looking at specific business email compromise (BEC) paths, token theft scenarios and lateral movement through overprivileged service principals will give you a greater understanding of where your AiTM risk lies.
Armed with this knowledge, you can make meaningful improvements that can significantly reduce the likelihood of a successful attack.
Account for Complexity in Policy Configuration and Deployment
Deploying security controls like Conditional Access, phishing-resistant MFA and Defender policies is straightforward in a clean environment. Most environments are not clean. Hybrid identity architectures, third-party integrations, legacy applications that do not support modern authentication and user experience considerations all introduce friction that turns a textbook deployment into something more nuanced.
Accounting for that complexity upfront prevents the cycle of deploying a control, breaking something, rolling it back and losing organizational trust in the process.
How GuidePoint Security Can Help
GuidePoint Security provides credentialed, expert cloud security services, including support across the Microsoft security stack. If you need help understanding where your Microsoft environment stands against AiTM and what it would take to close the gaps, we can help start that conversation.
FAQs
Can AiTM attacks bypass phishing-resistant MFA?
Not typically. FIDO2 security keys, passkeys and Windows Hello for Business are cryptographically bound to the legitimate domain. A proxy cannot relay that handshake, which is why these are the only MFA methods that stop AiTM.
However, while AiTM cannot break the cryptographic exchange of true phishing-resistant MFA, attackers bypass these deployments using secondary techniques, including MFA Downgrade Attacks, Authorization-Layer Phishing and Post-Authentication Session Theft.
How do you detect an AiTM attack in progress?
Watch for sign-ins from unfamiliar locations or devices immediately after a legitimate authentication. Entra ID Protection can flag impossible travel, anomalous token activity and risk events that indicate session hijacking.
What should you do if a session token is stolen?
Revoke the compromised session immediately and force reauthentication for the affected account. Then investigate what the attacker accessed during the active session and reset any credentials or permissions that were exposed.
How do you deploy phishing-resistant MFA without disrupting the business?
Start with a pilot group and expand in phases based on role sensitivity and application compatibility. Legacy applications that do not support modern authentication need workarounds before you enforce phishing-resistant methods organization-wide.
Nick Schmitz has spent more than six years deep in the Microsoft 365 world helping organizations secure their cloud environments before things go sideways.
Most of his time goes into helping organizations design and mature their Microsoft security posture, moving toward practical Zero Trust implementations that organizations can actually implement.
At GuidePoint Security, he works as a Sr. Principal Consultant for the Microsoft Cloud Security team, mostly focusing on Identity (Entra), which ties into Intune and Purview quite often as well.
