We currently have SharePoint 2016 server installed on Windows Server 2012 R2 Datacenter. I'm trying to figure out if I can do an in place upgrade of the server OS without breaking SharePoint. Or what is the best approach to achieve a successful upgrade?

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The best approach is to build brand new Windows Server 2019 VMs. Join them to the existing SharePoint farm, transfer over the Service Instances, repoint DNS/load balancer as required, then remove the 2012 R2 servers from the farm.

Upgrading Windows Server in-place is highly discouraged.

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