Can Azure Sentinel monitor on-prem only?

ShimKwan Just thinking here...

Can this be done?  Sure. 

But, a few things to consider (off the top of my head)...

You still have to get all on-premises logs to Azure (Log Analytics workspace) - which means installing the agent where ever it's needed (workstations, Syslog server, servers, DCs, etc.)

You'd still need to deploy AD Connect to synch your on-prem AD with Azure AD to apply Azure Sentinel roles and other things.

The SOAR capability will be difficult. You'll need to install a gateway for Logic Apps on-prem:

https://docs.microsoft.com/en-us/azure/logic-apps/logic-apps-gateway-install

https://docs.microsoft.com/en-us/azure/logic-apps/logic-apps-gateway-connection 

But, I can't be sure which SOAR capabilities of Azure Sentinel will work on on-prem.