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I have already run the PowerShell command Connect-SPFarmToAAD on the on-premises farm. (Connect-SPFarmToAAD is document here in detail: https://docs.microsoft.com/en-us/sharepoint/dev/sp-add-ins/use-an-office-365-sharepoint-site-to-authorize-provider-hosted-add-ins-on-an-on.)

When registering a new app on the appregnew.aspx page of my on-premises farm. I am not seeing it in my Azure AD environment anywhere. Should this work on-premises? Is there some other configuration to the farm that must be done?

I found a manual workaround that I could make a new client id in Azure AD via Azure app registration and give it a secret. Then create that same client id app on the SharePoint side via appregnew.aspx. Finally grant it permissions in appinv.aspx to the site or web I was working on. I didn't use the same secret which didn't matter actually, just as long as the ID's are the same things worked great for the standard ACS token request process.

When doing the appregnew.aspx process on a SharePoint Online I am seeing a new service principal created in Azure AD and things are working as expected.

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When registering a new app on the appregnew.aspx page of my on-premises farm, I am not seeing it in my Azure AD environment anywhere.

This is how it's supposed to work.

Should this work on-premises? Is there some other configuration to the farm that must be done?

I don't think such configuration exists.

When doing the appregnew.aspx process on a SharePoint Online I am seeing a new service principal created in Azure AD and things are working as expected.

Update: This is how it works in SPO. But not in on-prem.

Azure App Registration and SharePoint only app are two completely different types of apps and they are not connected in any way, AFAIK. Update: this is only true for SP on-prem. In case of SPO, SP-only app is also created in Azure AD (although it does not seem to have any API permissions).

To double-check it, in SPO, I have just created a new app via the appregnew.aspx and nothing was added to Azure AD.. Update: I was wrong, there was an app created an AD. I just had to search it by Client ID. Otherwise, it does not show up in the list of Enterprise apps.

There should be no synchronization happening between SharePoint-only apps and AD. Update: This is because AppRegNew.aspx page does not create anything in AD On-prem. So there is nothing to sync to Azure AD. I hope it makes sense.

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    I appreciate the quick response Denis. To re-create what I mention in my original post on your tenant. You would need to search Azure AD (AAD) by the Client ID which you newly created in SPO via appregnew.aspx. The key here in AAD, if using the GUI, is to utilize the Enterprise Applications search (selecting all applications in application type and pasting in the new Client ID, it should be found in the Application ID column). Click the app, you should see in the audit log that it was made the same time you made it in appregnew.aspx. That automation is what I am after essentially, if possible. – POWERShawn Sep 21 '20 at 5:00
  • @POWERShawn. my apoligies, you were right! I had no idea there was an Azure AD object created when using appregnew.aspx page. And I had no idea I could only find it via search. Question, out of curiosity: when creating an app on-prem, via the appregnew.aspx page, do you see something in the AD on-prem? – Denis Molodtsov Sep 26 '20 at 23:15
  • I have just tested creating SP-only apps in SP 2013. There seems to be no On-prem AD object created. It seems to be only Cloud-only feature – Denis Molodtsov Sep 27 '20 at 18:18

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