Azure Active Directory (AAD) is a cloud-based multi-tenant directory, which is an Identity as a Service (IDaaS) solution. AAD can be used as your main identity provider. It also provides tooling for integration with on-premise Windows AD, the ability to federate with multiple other directories, and SSO into thousands of third-party applications, such as Dropbox, Chef, Wordpress, and so on. For more information about AAD, please visit https://docs.microsoft.com/en-us/azure/active-directory/active-directory-whatis/.
Every Azure tenant is actually an AAD tenant. If you have signed up for an Azure account using a Microsoft Account, a new AAD tenant was created for you with a default domain of <emailAbbreviation>.onmicrosoft.com ...