Microsoft has made available multi-factor authentication for the following Office 365 plans:
- Midsize Business
- Exchange Online
- SharePoint Online
Multi-factor authentication will allow you to use your mobile phone, office phone, or a smartphone app as a secondary authentication mechanism to increase sign-in security. While client application (Microsoft Office) updates are forthcoming to enable seamless integration with multi-factor authentication, for the time being you have to use a feature called App Passwords, which automatically generate a 16 character secure password to use when signing in from applications other than the web – just another reminder that security and convenience rarely go hand-in-hand :).
To learn more about Multi-Factor Authentication for Office 365, read the Office Blog post.