Azure Active Directory Domain Services to join Azure virtual machines to a domain, without having to deploy domain controllers on virtual machines in Azure Cloud (IaaS model). Azure Active Directory Domain Services can contain objects such as a computer, users and group policy. Migrate on-premises Apps to Azure and sign in to Apps and Azure virtual machines using their corporate Azure Active Directory credentials and seamlessly access resources.
The Azure Active Directory Domain Services provide features like domain join, LDAP, NT LAN Manager (NTLM) and Kerberos authentication, which are widely used in enterprises. In short, Azure ADDS is a managed domain in the Cloud.
The Azure AD does not offer Group Policy, LDAP, NT LAN Manager (NTLM) and Kerberos authentication.