Distribution list vs security group vs Microsoft 365 group: which to use (and how each affects SharePoint access)

Published: 2026-10-26

Last updated: 2026-11-06

Understanding Microsoft 365 Group Types

Microsoft 365 offers several group types, each designed for different purposes. Choosing the right one impacts how your team communicates, collaborates, and manages permissions. This guide breaks down every group type—Distribution Groups, Security Groups, and Microsoft 365 Groups—so you can make the best choice for your organization.

Distribution list vs security group vs Microsoft 365 group: at a glance

Quick choice: use a distribution list for email only, a security group for access control, or a Microsoft 365 group for a shared team workspace. A mail-enabled security group combines email distribution with access control.

Microsoft explains these distinctions in its comparison of Microsoft 365 group types and SharePoint site permissions guidance.

Distribution Groups

A Distribution Group is a mail-enabled group that lets you send emails to multiple recipients at once. Instead of emailing seven people in your finance department individually, you send one email to the "Finance" group address and everyone receives it.

Key Features of Distribution Groups

• Dedicated email address — Each Distribution Group gets its own email, visible in the Global Address List (GAL) so every user in your organization can find and use it in Outlook.

• Delivery controls — Administrators can specify who is permitted to send to and from the group, helping prevent unwanted spam blasts.

• Delegated management — The group owner can add or remove members without needing IT involvement.

• Auto-caching in Outlook — Once a user sends to a Distribution Group, Outlook caches it for quick future access.

Distribution Groups vs. Outlook Contact Groups

An Outlook Contact Group (sometimes called a "local group") is created directly in Microsoft Outlook and stored on your machine. Here's why Distribution Groups are the better choice for teams:

Dynamic Distribution Groups

Dynamic Distribution Groups work like regular Distribution Groups, but their membership is calculated automatically based on filters and conditions you define—such as department, title, or organizational unit.

Why Use Dynamic Distribution Groups?

• Zero manual maintenance — When employees join, leave, or change departments, membership updates automatically.

• Fewer mistakes — No risk of forgetting to add new hires or remove departing employees.

• Scalable — Ideal for large organizations with frequent personnel changes.

You can create Dynamic Distribution Groups using PowerShell or the Exchange Admin Center, specifying criteria like recipient type, department, or custom attributes.

Maintenance Considerations

Regular Distribution Groups can be maintained by non-technical group owners. Dynamic Distribution Groups, however, require someone more technical (typically IT) to modify the filter logic or update Active Directory attributes that drive membership.

Security Groups

While Distribution Groups handle email, Security Groups handle permissions. Use them to grant a set of users access to resources like SharePoint sites, document libraries, specific folders, or web applications.

Two Types of Security Groups

1. Security Group — Used purely for assigning permissions to resources.

2. Mail-Enabled Security Group — Combines permission management and email distribution in a single group.

Why Use Security Groups?

Instead of assigning permissions to each user individually, create a Security Group containing all users who need the same access level. For example, if five team members need edit access to a SharePoint library, assign the Security Group once rather than adding each person separately.

Managing Security Group Members

Administrators can manage Security Group membership from:

• The Microsoft 365 Admin Center — Navigate to Groups and add or remove members.

• The Exchange Admin Center — Go to Recipients → Groups, select the group, click Edit, and modify membership.

Security Group vs. Distribution Group

The key difference is simple: a Distribution Group is for sending emails to multiple users. A Security Group is for managing permissions and access control. If you need both capabilities, use a Mail-Enabled Security Group.

Microsoft 365 Groups (Formerly Office 365 Groups)

Microsoft 365 Groups are the most powerful and modern group type, purpose-built for collaboration. When you create a Microsoft 365 Group, you automatically get:

• A shared mailbox with a dedicated email address (visible in GAL)

• A SharePoint team site for document collaboration

• A shared calendar for scheduling

• A OneNote notebook for shared notes

• A Planner board for task management

• Integration with Microsoft Teams

Privacy Settings

When creating a Microsoft 365 Group, you choose between Public (anyone in the organization can join and view content) or Private (only members can see group content). You can change this setting at any time through Outlook on the web.

Microsoft Teams Integration

Microsoft 365 Groups integrate seamlessly with Microsoft Teams. You can add any existing Microsoft 365 Group to Teams, or when you create a new Team, it automatically creates a corresponding Microsoft 365 Group. This gives you access to chat, video calls, file sharing, Planner, and SharePoint—all in one place.

Benefits of Microsoft 365 Groups

1. Group email — Send emails to all members just like a Distribution Group, with a shared mailbox that stores conversation history.

2. File collaboration — Upload, view, and co-edit files through OneDrive and SharePoint.

3. Shared calendar & planning — Schedule meetings and assign tasks with Planner.

4. Third-party connectors — Connect apps like Twitter, Trello, and other services.

5. OneNote integration — Share notes, ideas, and documentation.

6. Teams integration — Get a centralized hub for chat, calls, and collaboration.

7. Recoverability — Deleted groups can be restored for up to 30 days.

Complete Comparison: All Group Types

Which Group Type Should You Use?

Here's a quick decision guide:

• Just need to email a group of people? → Use a Distribution Group (or Dynamic Distribution Group for auto-managed membership).

• Need to control access to SharePoint, files, or apps? → Use a Security Group.

• Need both email and permissions? → Use a Mail-Enabled Security Group.

• Need full collaboration with email, files, calendar, Teams, and tasks? → Use a Microsoft 365 Group.

Admin Tips for Managing Microsoft 365 Groups

Finding Microsoft 365 Group Sites in SharePoint

In the classic SharePoint Admin Center, team sites created by Microsoft 365 Groups are hidden by default. Use the modern SharePoint Admin Center to see all sites, including those associated with Microsoft 365 Groups.

PowerShell Commands for Group Management

For administrators who prefer the command line, here are essential PowerShell commands:

• Get-UnifiedGroup — List all Microsoft 365 Groups

• Remove-UnifiedGroup -Identity group@domain.com — Delete a group

• Set-UnifiedGroup -Identity group@domain.com -HiddenFromAddressListsEnabled $true — Hide a group from the GAL

• Get-SPOSite -Identity https://yourcompany.sharepoint.com/sites/groupname — Get SharePoint site info

See which groups have access to your SharePoint sites, and who’s in them

A SharePoint permissions report can stop at the group name. “Marketing” might be a Microsoft 365 group or a security group with three nested groups inside it. Access can also come from a broad claim such as “Everyone except external users”. A name alone does not tell you who can reach your content.

SharePoint Essentials Toolkit can expand group memberships, including nested security groups, to the actual people across sites, and show sharing links alongside. Enable the group-expansion options when running your report so you can review the people behind the permission entries.

Group-expansion settings in SharePoint Essentials Toolkit: configure membership expansion before running the permissions report.

The Community Edition runs permissions reports free on up to 20 SharePoint site collections, with no trial period. The allowance is shared across Community keys in the same tenant; subsites share their parent site collection’s count.

Run a free permissions report →

Final Thoughts

Microsoft 365 Groups represent the most modern and feature-rich option for team collaboration. While Distribution Groups and Security Groups still serve important, focused roles, Microsoft 365 Groups combine email, file sharing, calendars, task management, and Teams integration into a single, easy-to-manage package.

For most new projects and teams, Microsoft 365 Groups are the recommended choice. They reduce administrative overhead, improve collaboration, and integrate seamlessly with the tools your team already uses every day.