Microsoft 365 Email Archiving: Plans, Setup, and Limits

Microsoft 365 email archiving gives each user a second mailbox, called an archive mailbox, where older mail moves automatically so the main mailbox stays within its size limit. Every Microsoft 365 Business plan includes one: 50 GB on Business Basic and Standard, and 100 GB that can auto-expand to 1.5 TB on Business Premium. It is off until an administrator enables it, and it is storage, not backup or legal preservation.

What is an archive mailbox?

An archive mailbox is extra mailbox storage attached to a user’s account. Microsoft’s documentation calls it an archive mailbox, and Outlook shows it as a separate folder tree (usually labeled Online Archive or In-Place Archive) under the person’s main mailbox.

Per Microsoft’s archive mailbox overview, users can open it in Outlook and Outlook on the web, search it, and move or copy messages in and out by hand. Nothing in it is hidden from the user, and nothing about it is permanent: a user can delete items from the archive the same way they delete them from the inbox.

Two automatic processes move mail into it once it is enabled:

• The default archive policy. Every Exchange Online mailbox is assigned a policy named Default MRM Policy (MRM is messaging records management, an older Exchange feature). It moves items that are two years old or older into the archive.
• Auto-archiving by size. Microsoft documents a newer safety valve that moves the oldest items to the archive when a mailbox passes a threshold, 96% of its quota by default, to keep mail flowing.

One thing to expect: when you first enable the archive, mail older than two years starts moving over. Tell people beforehand, because “my old email disappeared” is the usual reaction. It has only moved to the archive folder.

Which Microsoft 365 plans include email archiving?

This table summarizes Microsoft’s Exchange Online limits and the Exchange Online Archiving service description as of September 2026.

Plan	Archive mailbox	Auto-expanding archive	Litigation Hold
Microsoft 365 Business Basic	50 GB	With the Exchange Online Archiving add-on	With the add-on
Microsoft 365 Business Standard	50 GB	With the add-on	With the add-on
Microsoft 365 Business Premium	100 GB to start, up to 1.5 TB	Included	Included
Exchange Online Plan 1	50 GB	With the add-on	With the add-on
Exchange Online Plan 2	100 GB to start, up to 1.5 TB	Included	Included

Exchange Online Archiving is a per-user add-on. Microsoft lists Business Basic, Business Standard, and Exchange Online Plan 1 among the plans it can be added to, and says it adds auto-expanding archiving and Litigation Hold. Business Premium already includes those capabilities, which is one of the less visible differences covered in our Business Premium vs Standard comparison.

Shared mailboxes are a special case. Microsoft states an unlicensed shared mailbox is limited to 50 GB, and that giving a shared mailbox an auto-expanding archive or placing it on Litigation Hold requires assigning it a license (Exchange Online Plan 2, or Plan 1 plus Exchange Online Archiving).

How does auto-expanding archiving work?

Auto-expanding archiving removes the practical ceiling on the archive. According to Microsoft’s overview:

1. The archive starts at 100 GB, with a warning at 90 GB.
2. When it fills, Microsoft adds storage automatically, in increments, up to a maximum of 1.5 TB. That total includes the hidden Recoverable Items folder.
3. New storage can take up to 30 days to be provisioned.
4. It supports mailboxes growing by no more than 1 GB per day.

Two cautions from the setup documentation. It is enabled with Exchange Online PowerShell (the command-line tool for Exchange), either for the whole organization or per mailbox. And once turned on, it cannot be turned off. For most offices that is fine, but make it a deliberate choice.

Microsoft also restricts what an archive can be used for. It is for one user’s own mail. Using journaling, transport rules, or auto-forwarding to copy other people’s mail into one archive mailbox is not permitted.

How do you turn on an archive mailbox?

Per Microsoft’s instructions, it takes a few minutes per user:

1. Sign in to the Exchange admin center and go to Recipients > Mailboxes.
2. Select the user.
3. In the pane that opens, select Others, then under Mailbox archive select Manage mailbox archive.
4. Turn on Mailbox archive and select Save.
5. Refresh the list. The Archive status column should show Active.

You need the Mail Recipients role in Exchange Online, which administrators normally have. To enable every mailbox at once, Microsoft provides a PowerShell command on the same page.

Changing the two-year default

If two years is wrong for your office, the move-to-archive timing is changed with MRM retention tags, not with the newer Microsoft 365 retention policies. Microsoft’s worked example walks through it: in the Microsoft Purview portal go to Solutions > Data Lifecycle Management > Exchange (legacy) > MRM Retention tags, create a tag with the action “move to archive” and the age you want, add it to a new MRM retention policy, and assign that policy to mailboxes.

Microsoft is explicit that moving mail to the archive is one of the few remaining reasons to use MRM. For keeping or deleting mail, it recommends retention policies instead.

How is archiving different from backup?

They solve different problems, and having one does not give you the other.

	Archive mailbox	Retention policy or hold	Backup
Purpose	More room, tidier main mailbox	Keep (or delete) mail for a set period	Restore to an earlier point in time
Can the user delete items?	Yes	The user can delete, but a preserved copy is kept	Not from the backup
Separate copy?	No, it is the only copy	No, preserved copies live in the same mailbox	Yes
Helps after ransomware or a wiped mailbox?	No	Partly, through an administrator search	Yes

An archive is simply a second place where the one and only copy of a message lives. If someone deletes it there, the normal deletion clock starts, the same 14 days by default described in our Microsoft 365 backup guide. For restore points you control, you need a backup. For proof that mail was kept, you need retention or a hold.

Retention policies vs Litigation Hold

Both preserve mail even when a user deletes it. They differ in scope and intent.

Microsoft 365 retention policies are created in the Microsoft Purview portal under Data Lifecycle Management. A policy can keep mail for a period, delete it after a period, or both, across all mailboxes or selected ones. When a user deletes a message that is under retention, a copy is kept in the hidden Recoverable Items folder until the period ends. This is Microsoft’s recommended tool for routine record keeping. Organization-wide retention policies require Business Premium, an enterprise plan, or for mailboxes specifically Exchange Online Plan 2 or the Exchange Online Archiving add-on, per the Purview service description.

Litigation Hold is a switch on an individual mailbox that preserves everything in it, including deleted items and the original versions of edited items, indefinitely or for a number of days you set. Microsoft documents that the hold covers the archive mailbox too, and that the Recoverable Items quota rises from 30 GB to 100 GB while a mailbox is on hold. It is meant for legal matters: when a dispute is reasonably anticipated, your attorney will tell you whose mail must be preserved, and a hold is how you do it. Microsoft’s guidance is to use retention policies, not Litigation Hold, for long-term retention that is unrelated to a legal matter.

A simple way to choose:

• “We need to keep all client correspondence for seven years.” Use a retention policy.
• “We received a demand letter involving two employees.” Ask your attorney, and expect to place those mailboxes on Litigation Hold.
• “Mailboxes are full.” Enable archive mailboxes.
• “We want to be able to undo a disaster.” Get a backup.

How long to keep email is a legal and business decision, not a technical one. Rules differ by industry, and a policy that deletes too early can be as much of a problem as one that keeps everything forever. We configure what you and your advisors decide. This article is IT guidance, not legal advice.

What about people who leave?

When you delete a user, Microsoft keeps the mailbox for 30 days. If a retention policy or hold applied to the mailbox before deletion, it becomes an inactive mailbox, which preserves the content without a license for as long as the retention period or hold lasts. Without a hold or retention policy, the mail is removed after the 30 days. Build this into your offboarding steps before the account is deleted, not after.

When you do not need to do anything

If your mailboxes are small, nobody is near their quota, and you have no record keeping obligations for email, an archive mailbox adds little. Enabling it is harmless, but the two-year auto-move can confuse people who are used to searching one mailbox. It is reasonable to leave it off until someone approaches their limit.

Common mistakes

• Treating the archive as a backup or as tamper-proof storage.
• Enabling archives without warning staff that older mail will move.
• Exporting old mail to PST files on a PC to free up space. Those files are easy to lose and sit outside every protection described here.
• Copying everyone’s mail into one shared “archive” mailbox, which Microsoft’s terms prohibit.
• Setting a retention policy to delete after a period without checking what your industry requires you to keep.
• Deleting a departed user before deciding what happens to their mail.

Common questions

Is email archiving included in Microsoft 365 Business Standard?

Yes. Business Basic and Business Standard include a 50 GB archive mailbox per user. It is not enabled by default, so an administrator turns it on in the Exchange admin center. Auto-expanding archiving and Litigation Hold are not included on those plans without the Exchange Online Archiving add-on or a move to Business Premium.

Can staff see their archived email on a phone?

Microsoft’s documentation states that archive mailboxes are available in Outlook and Outlook on the web. Support in mobile mail apps varies and has changed over time, so check on the devices your staff use before promising it. Anyone can reach their archive from a browser through Outlook on the web.

Does the archive count against the main mailbox size?

No. The archive has its own quota, separate from the primary mailbox. That is the point: moving older mail into it frees space in the main mailbox without deleting anything. The hidden Recoverable Items folder also has its own quota in both the primary and the archive mailbox.

Do we need a third-party email archiving service?

It depends on your obligations, not on your size. For most small offices, archive mailboxes plus a retention policy cover routine record keeping. If your industry has specific rules about how electronic records must be stored, supervised, or produced, ask your compliance advisor what format a regulator would expect before relying on Microsoft 365 alone.

How we can help

Coastal Growth Co. can check which archiving features your current licenses include, enable archive mailboxes, adjust the move-to-archive timing, and set up the retention policies or holds that you and your advisors decide on. Scope and price are agreed before any paid work. See our cloud, email, and Microsoft 365 services, browse Microsoft 365 help in South Orange County, or get in touch.