Introduction

Azure AI Bot Service is the backbone for running bots in Azure. It handles bot registration, connectivity to chat channels, like Teams, scaling, and basic infrastructure. The Microsoft 365 platform leverages this service for custom AI agents:

• Microsoft 365 Agents SDK builds on Azure Bot Service to let you write custom bot logic while Azure AI Bot Service handles the routing to Teams and other channels. In practice, your agent is registered as an Azure Bot, which gives it a Microsoft App ID and enables it to appear in Teams or Outlook. • The Agents SDK is often seen as an evolution of the Bot Framework for the Copilot era. It uses the Bot Framework’s activity model under the hood, so your agent can manage dialogues (“turns”) and events similarly to a traditional bot. This means all the reliability and multi-channel support of Bot Framework (now Azure Bot Service) is inherited, while you get to plug in advanced AI logic. • Integration: The M365 Agents SDK enables your custom agent to integrate with Microsoft 365 Copilot (the user interface) and other 365 apps. Essentially, you build your bot as an Azure Bot + custom logic, and then connect it to Copilot/Teams via the SDK and toolkit so that it surfaces as a Copilot chat agent for users. The agent can also call into Microsoft Graph and other APIs to access organizational data as needed. Overall, Azure AI Bot Service provides the hosting and channel connections, while the M365 SDK provides the developer framework and toolkit to create a Teams-centric AI bot that can also extend to other platforms. This gives you the best of both worlds: enterprise-grade bot infrastructure plus custom AI behaviors.