Power Apps and Dataverse for Teams

What it does

Dataverse for Teams is a cut-down Dataverse environment created per team, so makers can build Power Apps, flows and Copilot Studio agents inside Teams on the licences they already have through Microsoft 365. The environment's lifecycle and security follow the team: owners, members and guests map straight to Dataverse roles.

Key facts

One Dataverse for Teams environment per team (1:1), created automatically the first time someone in that team builds an app or agent, or installs one from the catalogue that needs it.
Each environment has 2 GB of combined database and file storage, and it can't be extended.
Tenant limit: 5 environments plus 1 per 20 eligible Microsoft 365 licences. Tenants with 200,000+ seats talk to Microsoft for more.
Included with select Microsoft 365 subscriptions that carry Power Platform and Teams capabilities — not EDU A1 or SUB SKUs. Check the tenant's service plans rather than assuming.
Roles map automatically: team owners get System Administrator, members get Teams Member, guests get Teams Guest. Guests can use apps but can't create or edit them.
No direct API access, no record sharing, no copy or reset. Apps run in the Teams client; running them outside Teams needs a standalone Power Apps licence.
At 100% of the 2 GB, existing apps keep working but nobody can create new apps, flows, agents or tables. At 100% of the tenant-wide limit, new environments are blocked.
An environment can be upgraded to full Dataverse by a tenant admin. It then consumes tenant Dataverse capacity, needs Power Apps/Power Automate licences, and stops being tied to the team's lifecycle.
Inactive environments are disabled after 90 days without activity and deleted at 120 days, with warning emails to team owners at 83/87 and 113/117 days. Deleted environments can be recovered within 7 days. There's no opt-out.
Power Platform DLP and tenant isolation policies apply to Teams environments, and can be applied to all of them via PowerShell.
Admins can stop Power Apps and Copilot Studio creation in Teams through app availability on the Manage apps page.

When to use / skip

It's a good fit for small, team-scoped apps: an equipment checkout, a shift handover log, a simple request tracker that only the team uses. The value is that it costs nothing extra and the permissions model is just team membership, which business users understand.

Skip it the moment the app needs to serve people outside the team, integrate with other systems through APIs, hold more than a modest amount of data, or survive the team being archived or deleted. Those all push you to a proper Dataverse environment with Power Apps licences — and it's cheaper to start there than to upgrade an app the business already depends on. For anything touching a Dynamics 365 or contact-centre solution, it's the wrong tier entirely.

Configuration decisions

Whether makers are allowed to create in Teams at all, or only a named set of teams.
DLP policy for Teams environments — usually the same baseline as the default environment, applied at tenant level.
Ownership: who gets notified when an environment nears inactivity deletion, given only team owners receive the emails.
Promotion criteria: the point at which a Teams app gets upgraded to full Dataverse (users outside the team, data growth, integration needs).
How Teams environments are surfaced in the client's Power Platform governance (CoE Starter Kit or equivalent).
Guest policy — guests in the team inherit access to the app's data.

Gotchas

Deprecated 15 November 2026: Dataverse for Teams environments are deprecated. New ones can't be created after 15 November 2026, and environments not upgraded to full Dataverse are decommissioned on 30 October 2027. Microsoft's page also lists a suspension date of 15 September 2026, which sits before the creation cut-off, so check it before you quote it to a client. See deprecation page.
The environment dies with the team. Delete or let the team expire under a Microsoft 365 group expiration policy and the app goes with it.
Inactivity deletion counts launches, flow runs and maker edits — not people looking at the designer. A quarterly-use app can be disabled between uses.
Team owner turnover means deletion warnings go to people who've left. Make sure every team with an app has at least two active owners.
The 2 GB is shared with files and attachments. Image-heavy apps hit it faster than anyone expects.
Upgrading needs available tenant Dataverse capacity equal to the environment's size; check before promising a date.
Once you start hitting the "can't call it from outside Teams" limit, there's no partial fix — it's upgrade or rebuild.
Guests are automatically Teams Guests in Dataverse — fine until a sensitive table ends up in a team with external members.

Consultant notes

Inventory Teams environments early in any Power Platform or Teams governance engagement; they're often the shadow-IT apps nobody listed.
Treat Dataverse for Teams as a prototyping tier with an agreed graduation path, and write that path down.
Set a calendar reminder on business-critical Teams apps that run rarely, or add a scheduled flow, so inactivity cleanup doesn't take them out.
Pair the team's lifecycle settings (expiry, archiving) with what's in its Dataverse environment before applying group expiration.
Copilot Studio agents built in Teams sit in the same environment — those decisions belong with the agents workstream, but the storage and lifecycle limits here still apply.

Worth revisiting if Microsoft changes the per-environment storage cap or the inactivity cleanup thresholds