TL;DR;

A Microsoft account, also referred to as a personal account, provides authentication and authorization to Microsoft’s consumer services such as OneDrive and Office subscriptions. On the other hand, a work or school account is created by an organization using a business service that has Azure Active Directory as the authentication and authorization platform. The organisation authenticates your access to resources based on its business plans.

A Microsoft account (MSA) is an account created by a user for personal use and is the new name for what used to be called “Windows Live ID”. The Microsoft account is the combination of an email address and a password that a user uses to sign in to all consumer-oriented Microsoft products and cloud services such as Outlook (Hotmail), Messenger, OneDrive, MSN, or Xbox LIVE. Your Microsoft account is created and stored in the Microsoft consumer identity account system that’s run by Microsoft.

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If you’ve ever needed to login to a Microsoft service, a screen similar to this one should be familiar to you. It outlines the list of services you can access for personal use and covers all of the consumer-facing Microsoft products and cloud services.

A work or school account is an identity created through Azure Active Directory or another Microsoft cloud service, such as Microsoft 365. A work account typically uses an organization’s custom domain name or company name, such as jon@contoso.com. These are created by an organization’s administrator to enable a member of the organization access to Microsoft cloud services such as Microsoft Azure, Microsoft Intune or Microsoft 365. […]

If you’ve ever had to use a separate account to login to Microsoft services connected to your school, university or workplace, that account is registered via Azure Activity Directory which enables you to access business plans linked to your organisation.

User management is then done by your organisation via Azure Active Directory in the Azure portal.

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The delineation is as follows:

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