Setting Up Public Folders in Office 365 Made Easy

Written By Tej Pratap Shukla

Approved By Anuraag Singh

Modified On May 15th, 2026

Reading Time 4 Min Read

By setting up public folders in Office 365, M365 admins get a digital storage cabinet for their organization. With options to create multi-level hierarchies that manage shared communications and directory data for thousands of users.

However, creating an O365 Public Folder for the first time can be difficult. Especially if you also want to migrate legacy public folders to Exchange Online sometime later.

That is why you need a solid plan going forward, and that is what I will give you. So you can keep within the total storage quotas and have a solid directory architecture.

Let me explain the prerequisites you need to cover before you can start making Public Folders in O365.

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Do This Before Setting Up Public Folders in Office 365

Public Folders cannot be made in any O365 environment by any user. You need specific licensing requirements. Which are as follows:

Global Administrator is recommended, but the Exchange Administrator Role should be sufficient.
Users for whom you are making the O365 Public Folders must have Exchange Online licenses. So check your Office 365 plan and assign licenses.
Outlook desktop client Classic or new variant (For the best creation and management experience at the user level)

Note: You can’t make a Public Folder unless there already exists a Public Folder Mailbox. So let’s start there.

Step-by-Step: Create a Public Folder Mailbox in Office 365

There are two ways to make it. First, let’s see the GUI method using the Exchange Admin Center (EAC):

Step 1. Log in to your Microsoft 365 Admin Center portal → open Admin centers → choose Exchange.
Step 2. Look for the Public folders option → choose Public folder mailboxes.
Step 3. Press the Add button, put in a unique name (like, for e.g., “PrimaryPFMailbox”), and hit create.

Also Read: Ways to Migrate Public Folder from Exchange 2010 to Exchange 2016

This will be the first mailbox and thus becomes the parent hierarchy mailbox by default.

If you like speed and are comfortable with scripts, then you can try out the second method to make an O365 Public Folder mailbox via PowerShell.

Step 1. Launch a PowerShell instance in admin mode.
Step 2. Connect to your M365 account.
Step 3. Then type:

New-Mailbox -PublicFolder -Name “MasterHierarchy”

You are not limited to a single Public Folder Mailbox. Feel free to create additional secondary mailboxes if you are building for larger deployments.

Create an O365 Public Folder

Log back in to the Exchange Admin Center.
Then, again, go to the Public folders section → and click the Public folders.
Pick the parent folder and click the + icon.
Type in the name you want and press save.

For users with Outlook client access, the approach is a bit different.

Step 1. Press Ctrl + 6 to switch to Public Folders view.
Step 2. Right-click on the parent folder → New Folder.
Step 3. Add a name and decide the type (Mail, Calendar, Contacts, etc.).

Note: You can and should use the “Ctrl + Shift + E” shortcut to add public folders in Outlook. There are certain hidden limits that you must be aware of while making Public Folders in O365.

Table to Understand the Public Folder Creation Limits

Aspect	Limit	Recommendation
Total Public Folders	500,000 (supported)	Performance drops beyond this
Subfolders per Parent	10,000 (warning at 9,000)	Keep well below
Nesting Depth	300 levels maximum	Ideally under 150 levels
Folder Name Length	~64 characters practical (especially mail-enabled)	Keep concise
Allowed Characters	Broad, but avoid \, leading/trailing spaces, and certain symbols	Use clean names for better compatibility
Items per Folder	~1 million recommended	Monitor performance
Individual Folder Size	Default 2 GB (adjustable)	Keep under 15–25 GB for easier management
Public Folder Mailboxes	1,000 per tenant	Auto-split helps balance the load

Create O365 Public Folders With a Tool

The SysTools Office 365 Public Folder Migrator not only does the full transfer of Public folder content across two different Office 365 systems, but also contains the facility to create new folders in the target account.

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Get your free demo copy today to try out the feature on your system.

My Verdict

Setting up public folders in Office 365 might seem difficult at first. However, with the right approach, it can be done safely without investing much time. So follow the guide here and use the tool if you ever find yourself shifting Public folders.