M3
M365 Licensing

Microsoft 365 E3 vs Office 365 E3

50 shared features. 82 M365 E3 exclusives.

O365 E3 $23/mo M365 E3 $36/mo +$13/mo delta

Last updated 2026-02-15

O365 E3

Office 365 Enterprise E3

$23/mo

50 features included

Core productivity + baseline security

Conditional Access, Defender P1

View full feature list →
+$13/mo

M365 E3

Microsoft 365 E3

$36/mo

132 features included

Everything in O365 E3 + advanced security

Defender P2, advanced compliance, Phone System

View full feature list →

Overview

Office 365 E3 and Microsoft 365 E3 share the same productivity apps—Word, Excel, PowerPoint, Teams, Exchange Online, SharePoint—but that is where the similarity ends. Office 365 E3 at $23/user/month is a productivity-only suite. Microsoft 365 E3 at $36/user/month is a full platform that adds Windows 11 Enterprise, Enterprise Mobility + Security, and device management capabilities.

The $13/month price gap buys 82 additional features spanning device management (41 features), identity and access (25 features), security (12 features), and compliance (4 features). These are the tools that let IT manage endpoints with Intune, enforce Conditional Access policies, deploy Windows Autopilot, and protect data with Azure Information Protection P1.

If your organization already manages Windows licensing and EMS separately, Microsoft 365 E3 almost certainly saves money by bundling everything. If you only need cloud productivity apps and your users work exclusively in browsers or on unmanaged devices, Office 365 E3 keeps costs low.

Breakdown by Category

CategorySharedM365 E3 OnlyTotal
Devices04141
Identity12526
Security11213
Compliance7411
Productivity21021
Collaboration20020

Feature Comparison

82 features
FeatureO365 E3
$23
M365 E3
$36
Active Directory RMS IDN
—✓
Advanced Threat Analytics (retiring) SEC
—✓
Azure Active Directory Premium Plan 1 IDN
—✓
Administrative Units IDN
—✓
Application Proxy IDN
—✓
Azure AD Connect Health IDN
—✓
Azure AD Reports IDN
—✓
Azure Multi-Factor Authentication (MFA) IDN
—✓
Cloud App Discovery IDN
—✓
Conditional Access IDN
—✓
Dynamic Groups IDN
—✓
Enterprise State Roaming IDN
—✓
External Identities IDN
—✓
Microsoft Identity Manager IDN
—✓
Password Protection IDN
—✓
Self-Service Group Management IDN
—✓
Self-Service Password Reset in AD IDN
—✓
Shared Account Password Roll-Over IDN
—✓
Single-Sign-On to other SaaS IDN
—✓
SMS Sign-In IDN
—✓
Temporary Access Pass IDN
—✓
Terms of Use CMP
—✓
3rd Party MFA Integration IDN
—✓
Azure RMS CMP
—✓
Config Manager DEV
—✓
Config Manager Endpoint Protection DEV
—✓
Endpoint Analytics DEV
—✓
Information Protection CMP
—✓
Intune DEV
—✓
Windows Server CAL Rights IDN
—✓
Always On VPN DEV
—✓
Application Control DEV
—✓
Application Guard DEV
—✓
AppLocker DEV
—✓
App Assure DEV
—✓
Assigned Access DEV
—✓
Attack Surface Reduction (ASR) SEC
—✓
Azure AD Join IDN
—✓
BitLocker DEV
—✓
BitLocker to Go DEV
—✓
BranchCache DEV
—✓
Cortana DEV
—✓
Custom Logon DEV
—✓
Custom Shell DEV
—✓
Credential Guard SEC
—✓
Defender for Endpoint Plan 1 SEC
—✓
Block at First Sight DEV
—✓
Centralized Management DEV
—✓
Defender for Endpoint for Mac SEC
—✓
Defender for Endpoint for Mobile SEC
—✓
Enhanced ASR DEV
—✓
Manual Response Actions DEV
—✓
Tamper Protection SEC
—✓
Web Content Filtering DEV
—✓
Device Guard SEC
—✓
DirectAccess DEV
—✓
Domain Join DEV
—✓
Edge for Business DEV
—✓
Keyboard Filter DEV
—✓
Long Term Servicing Channel DEV
—✓
Manage by MDM DEV
—✓
MDOP (retiring) DEV
—✓
Microsoft Defender Antivirus SEC
—✓
Microsoft Store for Business DEV
—✓
Persistent Memory DEV
—✓
Resilient File System (ReFS) DEV
—✓
SMB Direct DEV
—✓
Unbranded Boot DEV
—✓
Unified Write Filter DEV
—✓
Universal Print DEV
—✓
Voice, Pen, Touch, Ink, and Gesture DEV
—✓
Windows Autopatch DEV
—✓
Windows Autopilot DEV
—✓
Windows Conditional Access IDN
—✓
Windows Firewall SEC
—✓
Windows Hello for Business IDN
—✓
Windows Information Protection (retiring) CMP
—✓
Windows Update for Business DEV
—✓
Windows Virtualization Rights DEV
—✓
Windows 11 Support Period DEV
—36 months
Office Professional Plus SEC
—✓
Office Servers SEC
—✓

Who Should Choose O365 E3?

Office 365 E3 is the right fit for organizations that only need cloud-based productivity and collaboration. If your users work primarily in web browsers or on personally owned devices, you do not manage a Windows endpoint fleet, and you handle identity and security through a separate stack (or do not need those controls yet), O365 E3 at $23/user/month delivers the full Office apps suite, 50 GB Exchange mailboxes, unlimited OneDrive storage, and Teams without paying for capabilities you will not use.

Who Should Choose M365 E3?

Microsoft 365 E3 is built for organizations that need to manage devices, enforce security policies, and control identity from a single platform. If you deploy Windows PCs, need Intune for device management, require Conditional Access or Azure AD P1, or want Azure Information Protection, M365 E3 bundles all of this at $36/user/month. Buying Office 365 E3 ($23) plus Windows Enterprise E3 ($7) plus EMS E3 ($10.60) separately would cost $40.60/user/month—making M365 E3 the cheaper path.

Cost Analysis

O365 E3 monthly

$23

M365 E3 monthly

$36

Monthly delta

+$13

Annual delta (per user)

+$156

The Verdict

If you manage Windows devices or need identity and security controls, Microsoft 365 E3 at $36/user/month is the clear choice—it bundles everything for less than buying the components separately. If you only need cloud productivity apps without device management or advanced security, Office 365 E3 at $23/user/month saves $13/user/month by skipping capabilities you do not need.

Frequently Asked Questions

What is the difference between Microsoft 365 E3 and Office 365 E3?
Office 365 E3 is a productivity-only suite that includes the Office apps, Exchange Online, SharePoint, OneDrive, and Teams. Microsoft 365 E3 includes everything in Office 365 E3 plus Windows 11 Enterprise, Enterprise Mobility + Security E3 (Intune, Azure AD P1, Azure Information Protection P1), and advanced compliance tools. M365 E3 adds 82 features that O365 E3 does not have.
Is Microsoft 365 E3 worth $13 more than Office 365 E3?
Yes, if you need device management or identity controls. Microsoft 365 E3 at $36/user/month bundles Windows 11 Enterprise ($7 standalone), Intune ($10.60 in EMS E3), and Azure AD P1. Buying these separately with Office 365 E3 costs over $40/user/month. You save money and get a single management console. If you do not manage Windows devices, the extra $13 may not be justified.
Does Office 365 E3 include Windows licenses?
No. Office 365 E3 does not include Windows 11 Enterprise or any Windows upgrade rights. You would need to license Windows separately through volume licensing or a Windows 365/Microsoft 365 subscription. Microsoft 365 E3 includes Windows 11 Enterprise E3 with upgrade rights, Windows Autopilot, and Windows Update for Business.
Does Office 365 E3 include Intune or device management?
No. Office 365 E3 does not include Microsoft Intune or any endpoint management capabilities. To manage devices with O365 E3, you would need to purchase Intune separately or add Enterprise Mobility + Security E3. Microsoft 365 E3 includes Intune and the full EMS E3 suite for mobile device management, mobile application management, and PC management.
Can I upgrade from Office 365 E3 to Microsoft 365 E3?
Yes. You can upgrade users from Office 365 E3 to Microsoft 365 E3 through the Microsoft 365 admin center. The transition is seamless with no disruption to existing services. All Office 365 E3 features carry over, and users gain immediate access to Windows 11 Enterprise, Intune, Azure AD P1, and the other 82 additional features.
What security features does Microsoft 365 E3 add over Office 365 E3?
Microsoft 365 E3 adds Azure Active Directory P1 (Conditional Access, MFA, self-service password reset), Azure Information Protection P1 (data classification and labeling), Microsoft Defender for Endpoint P1 (basic endpoint protection), and Intune-based device compliance policies. Office 365 E3 includes Defender for Office 365 Plan 1 and basic Exchange security, but lacks the endpoint and identity security layer.

Explore More

Office 365 Enterprise E3

Full feature breakdown

Microsoft 365 E3

Full feature breakdown

Full Comparison Matrix

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