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Azure Integration Services Blog
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🚀 New in Azure API Management: MCP in v2 SKUs + external MCP-compliant server support

anishta's avatar
anishta
Icon for Microsoft rankMicrosoft
Aug 05, 2025

Your APIs are becoming tools. 
Your users are becoming agents. 
Your platform needs to adapt.

Azure API Management is becoming the secure, scalable control plane for connecting agents, tools, and APIs — with governance built in. 

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Today, we’re announcing two major updates to bring the power of the Model Context Protocol (MCP) in Azure API Management to more environments and scenarios: 

  1. MCP support in v2 SKUs — now in public preview 
  2. Expose existing MCP-compliant servers through API Management 

These features make it easier than ever to connect APIs and agents with enterprise-grade control—without rewriting your backends. 

Why MCP? 

MCP is an open protocol that enables AI agents—like GitHub Copilot, ChatGPT, and Azure OpenAI—to discover and invoke APIs as tools. It turns traditional REST APIs into structured, secure tools that agents can call during execution — powering real-time, context-aware workflows. 

Why API Management for MCP? 

Azure API Management is the single, secure control plane for exposing and governing MCP capabilities — whether from your REST APIs, Azure-hosted services, or external MCP-compliant runtimes. 

With built-in support for:  

  • Security using OAuth 2.1, Microsoft Entra ID, API keys, IP filtering, and rate limiting.  
  • Outbound token injection via Credential Manager with policy-based routing.  
  • Monitoring and diagnostics using Azure Monitor, Logs, and Application Insights.  
  • Discovery and reuse with Azure API Center integration.
  • Comprehensive policy engine for request/response transformation, caching, validation, header manipulation, throttling, and more.  

…you get end-to-end governance for both inbound and outbound agent interactions — with no new infrastructure or code rewrites. 

✅ What’s New?

1. MCP support in v2 SKUs

Previously available only in classic tiers (Basic, Standard, Premium), MCP support is now in public preview for v2 SKUs — Basic v2, Standard v2, and Premium v2 — with no pre-requisites or manual enablement required. 

 You can now: 

  • Expose any REST API as an MCP server in v2 SKUs 
  • Protect it with Microsoft Entra ID, keys or tokens 
  • Register tools in Azure API Center 

2. Expose existing MCP-compliant servers (pass-through scenario)

Already using tools hosted in Logic Apps, Azure Functions, LangChain or custom runtimes? Now you can govern those external tool servers by exposing them through API Management. 

 Use API Management to: 

  • Secure external MCP servers with OAuth, rate limits, and Credential Manager 
  • Monitor and log usage with Azure Monitor and Application Insights 
  • Unify discovery with internal tools via Azure API Center 

🔗 You bring the tools. API Management brings the governance. 

🧭 What’s Next 

We’re actively expanding MCP capabilities in API Management: 

  • Tool-level access policies for granular governance 
  • Support for MCP resources and prompts to expand beyond tools 

📚 Get Started 

Summary 

Azure API Management is your single control plane for agents, tools and APIs — whether you're building internal copilots or connecting external toolchains. This preview unlocks more flexibility, less friction, and a secure foundation for the next wave of agent-powered applications. 

No new infrastructure. Secure by default. Built for the future. 

Updated Aug 05, 2025
Version 1.0

3 Comments

  • klein585's avatar
    klein585
    Copper Contributor

    Currently all our testing environments are in the "Developer" tier . 

    Will it be available in the future also in this tier? 

     

    • anishta's avatar
      anishta
      Icon for Microsoft rankMicrosoft

      Yes we are working to get this enabled shortly

  • To try out this new exciting features I just updated the labs on the AI Gateway repo:

    1️⃣ New lab 🧪 mcp-from-api.

    The lab uses the Basic v2 SKU and BICEP 🦾 to create MCP servers from existing REST API's and MCP pass-trough:

    • Weather MCP server based on an existing API (the hello world for MCP)
    • Microsoft Learn MCP pass-trough for the Learn MCP server (https://learn.microsoft.com/api/mcp)
    • Product Catalog MCP based on an existing API (mock) - protected with OAuth Authorizations
    • Place Order MCP based on a Logic Apps workflow - protected with OAuth Authorizations  

    👉 To test MCPs, the lab features Python snippets with the MCP SDK and showcases Agent implementations using both the OpenAI Agents and Azure AI Foundry Agents SDKs! The inference APIs, the backend APIs and MCP servers are all served trough the AI Gateway, enabling the

    📊 The lab includes an Azure Dashboard and an Azure Monitor Workbook with specific MCP Insights. 

    ✨ The lab also uses Azure API Center as the enterprise MCP registry, loading all APIs MCP's and third-party MCPs for easy discovery and seamless onboarding to MCP clients like VS Code.

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    2️⃣ To explore the new MCP Dynamic Client Registration using OAuth, I have updated the lab 🧪 mcp-client-authorization.

    👉 This is an experimental feature (not ready for production) that could be easily tested with the MCP inspector tool.

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    3️⃣ I have also updated the lab 🧪 realtime-mcp-agents to try out the APIM credential manager for authorizing backend APIs and MCP servers!

    👉 This lab uses the real-time API and Spotify MCP tool to create exciting audio conversations, allowing you to easily interact with your playlists and control playback!

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    🚀 We're thrilled to announce that our backlog now includes even more labs and samples! Share your thoughts and let us know what features or scenarios you'd like to see next!