What are sensitivity labels?

Sensitivity labels help you protect and classify your Microsoft 365 groups, SharePoint sites, Teams, and other workspaces in a Microsoft 365 tenant. They play a crucial role in data security by preventing unauthorized access and reducing the risk of data leaks. At the same time, they help organizations stay compliant with legal and regulatory requirements by consistently enforcing protection policies.

Think of them as digital security tags you can stick on workspaces and Microsoft 365 assets, such as files and emails. These tags tell the system, “Hey, this is top secret!” or “This is just internal info.”

Based on the label, Microsoft 365 automatically applies protections, like encryption, restricting who can see the file, or even blocking it from being shared outside your company.

Different organizations have unique data classification needs. Factors such as industry regulations, critical business data, and multiple labeling solutions affect your labeling strategy. A phased implementation approach (Crawl-Walk-Run) helps with gradual adoption and avoids common pitfalls.