Extending Protection for Confidential SharePoint Online Files

Sensitivity labels offer great protection against unauthorized access, but sometimes files that aren’t encrypted escape from a document library. SharePoint Online can now use sensitivity labels configured with user-defined permissions (UDP) to extend protection to downloaded files. The magic works by configuring permissions on download based on the membership of the user who downloads a file.

https://office365itpros.com/2026/02/26/sensitivity-label-extend-protection/