Error: 550 5.7.367 Remote server returned not permitted to relay -> 554 5.7.1 <external@hotmail.com>: Relay access denied - ProofPoint - mx1-eu1.ppe-hosted.com

Root Cause:

Emails sent to external domains were not delivered because the secondary domain controller, recently added in the Microsoft 365 Admin Center, was not properly configured for outbound mail flow. This misconfiguration prevented successful delivery to external recipients.

User email is not authorized to relay messages through the server that reported this error.

Status code: 550 5.7.367

Error: 550 5.7.367 Remote server returned not permitted to relay -> 554 5.7.1 <external@hotmail.com>: Relay access denied Message rejected by: mx1-eu1.ppe-hosted.com

How can this error be resolved by allowing emails to be sent to external domains like Hotmail, Gmail, and other external domains?

Follow one of the methods mentioned below

Method 1: Add the secondary domain to the Proofpoint portal

1. Log in to the Proofpoint portal with Admin login.
   
2. Add a new domain based on the below screenshot and point the primary Delivery Destination , and save the changes.
   
   
   
3. After saving the changes, add the new mentioned TXT record to the domain host (GoDaddy or CloudFront, etc).
   
4. Click on the verify option in Proofpoint and verify the relay
   
5. Below are the verified screenshots
   
6. Draft another email and verify successfully delivered or not.
   

Method 2: SMTP Connector for External domain

1. Sign In to the Office 365 Admin Center
   
2. Go to the Admin Center by visiting https://admin.microsoft.com.
   
3. Sign in with your admin account credentials.
   
4. Access the Exchange Admin Center\
   
5. In the Admin Center, expand the Admin centers section in the left-hand sidebar.
   
6. Click on Exchange to open the Exchange Admin Center (EAC).
   
7. Set Up a New Connector
   
8. In the Exchange Admin Center, navigate to Mail flow in the left-hand menu.
   
9. Click on Connectors under the Mail flow section.
   
10. Click on the + (plus) sign to create a new connector.
    
11. Choose the Connector Type
    
12. You'll be prompted with two options:
    
13. From Office 365 to your email server (choose this if you're routing mail from Office 365 to an external email server).
    
14. From your email server to Office 365 (choose this if you're routing mail from an external server to Office 365).
    
15. For SMTP configuration, choose From your email server to Office 365. This is the most common setup for sending emails from an external service to Office 365.
    
16. Click Next.
    
17. Configure the Connector Settings
    
18. Name the Connector:
    Give the connector a name (e.g., "SMTP Connector for External App").
19. Configure the Sender:
    Under "How do you want to identify the sender?", choose By verifying that the sender’s IP address is in a specific range or matches a specific IP.
    Enter the IP address range of the external application/server that will be sending the emails. You can specify the IP addresses of the external service or server from where emails will originate.
20. Click Next.
    
21. Choose Security Settings
    You will be asked to choose how to secure the communication between the external server and Office 365. Select the option that fits your setup:
    Only when the email is sent from a specific IP range (Recommended for external servers).
22. Require TLS encryption: Ensure that STARTTLS is selected, as this is required for secure communication.
    
23. Click Next.
    
24. Review and Save the Connector
    
25. Review the connector settings. Ensure the information is correct, such as the name, IP ranges, and encryption settings.
    
26. Click Create to save the connector.
    
27. Test the Connector
    
28. After creating the connector, go to the Mail flow section in the Exchange Admin Center.
    You can now send a test email from the external service that uses your configured SMTP settings to ensure that the connection works.
29. If the test email is successful, your SMTP connector is set up and functional!
    

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