Authenticated delegation lets a service answer three separate questions: Which agent is making this request? Who authorized it to act? What may it do to this resource? The agent proves its identity, a credential or verifiable chain conveys the authority it received, and the receiving service independently decides whether the requested action is permitted.
Authentication, delegation and authorization are different checks
These terms describe related but distinct parts of a request:
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- Authentication establishes control of an identity credential—for example, that a caller controls a key or presents a token accepted as its identity.
- Delegation conveys authority from a principal, such as a user or organization, to an agent. It should make clear whose authority is being used and any limits on it.
- Authorization is the receiving service’s decision about whether that caller may perform this operation on this resource.
A successful identity check is not permission to do anything the agent asks. The W3C AI Agent Protocol Community Group document puts the distinction plainly: “Successful authentication establishes control of a verification method authorized by the DID Document’s authentication relationship. It does not grant access to any resource.” The service must still apply its authorization policy.
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Think of delegation as a verifiable chain, not a shared password: a user or organization grants limited authority; an agent authenticates as itself while acting; a credential carries relevant context; and the destination checks both that credential and its own rules. If the agent hands work to another agent, the next service needs enough attributable, constrained authority to evaluate that request too. Exchanging a token can help carry this context, but it does not define the application’s policy by itself.
How a representative OAuth on-behalf-of flow works
Microsoft documents an Entra-specific example in which an agent acts for a signed-in user. In that setup, the flow is:
- The user signs in to a client application, which obtains a user access token.
- The client sends that token to an agent identity blueprint so the agent can act on the user’s behalf.
- The blueprint authenticates using its configured credential and obtains a token used to represent the child agent identity in the exchange.
- The agent identity presents the user assertion and agent credential in an on-behalf-of (OBO) token exchange for a downstream resource.
- The identity provider validates the tokens and their linkage, including audience constraints, then returns a token for the resource. The agent uses that resource token for the requested scope.
Audience is a practical boundary in this flow: Microsoft’s documentation says the user assertion must be addressed to the agent identity blueprint. A token intended for a different audience is rejected. A token being valid does not make it appropriate for every service or operation.
This is Microsoft’s implementation, not a universal recipe for agent delegation. Its guidance distinguishes agents acting for signed-in users from autonomous, app-only operation. For its documented setup, Microsoft recommends managed identities as the credential type, warns against production client secrets for agent identity blueprints, and recommends its approved SDKs. It says manual implementation is complex and error-prone; those are Microsoft-specific implementation recommendations, not requirements imposed by OAuth generally.
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| Approach | Identity and delegation | Trust boundary and authorization | Status and scope |
|---|---|---|---|
| OAuth token exchange / OBO | An OAuth token exchange can exchange a subject token for another token; an OBO implementation can represent a user-delegated request alongside an agent identity. | Usually relies on an identity provider and the receiving resource’s token validation and policy. Audience and scopes help constrain the token’s intended use. | IETF RFC 8693, published in October 2015, defines the general token-exchange mechanism. It does not prescribe full semantics or authorization policy for every agent chain. Microsoft’s OBO guidance documents one vendor-specific implementation. |
| Workload identity | Identifies a running service or agent workload, rather than by itself proving what a user authorized it to do. | Useful for authenticating a workload in a managed environment. The service still needs policy and suitable delegation context to decide what the workload may do. | NIST’s February 2026 NCCoE concept paper identifies SPIFFE/SPIRE as one possible approach and lists OAuth, OIDC, SCIM and NGAC among practices under consideration. The paper describes an initial enterprise-focused effort, not a completed deployment profile. |
| DID-based signed HTTP request | The caller signs a request with a key associated with a decentralized identifier (DID); the verifier resolves the DID and checks that the key is authorized for authentication. | The recipient verifies the signature and request, then separately applies authorization policy. The community document also discusses time windows and nonce/replay-cache defenses. | The W3C AI Agent Protocol Community Group document describes this approach but is neither a W3C Standard nor on the W3C Standards Track. |
There are also agent-specific proposals. The IETF Agent Identity Protocol (AIP) Internet-Draft describes agent identity, a principal/delegation chain and capability data, and says it can sit beneath MCP’s tool authorization flow. It is a draft proposal, not a completed standard; draft revisions can change. The paper Authenticated Delegation and Authorized AI Agents proposes extending OAuth and OpenID Connect with agent-specific credentials and metadata to make delegation auditable. It, too, is a proposal.
These approaches address different identity scopes and trust arrangements; none is established here as best across every comparison. Before adopting one, check who issues and verifies identities, how authority is represented, whether permissions can be scoped to a resource and operation, how keys and credentials are rotated or revoked, how replay is prevented, and whether the counterparties actually support the same profile.
What to verify before allowing an agent to act
- Identify the caller separately from the principal. Know which agent or workload instance is making the request and whose authority it claims to use. Microsoft’s OBO flow and the AIP draft illustrate these as distinct identities.
- Check the intended audience and scope. Validate that a token is meant for this resource and carries only the authority needed for the requested operation. Reject credentials addressed elsewhere.
- Apply authorization at the destination. A valid token or signature establishes facts about identity and, potentially, delegated context. The resource must still decide whether the specific action is allowed.
- Protect credentials and use maintained implementations. For Microsoft’s documented Entra setup, follow its managed-identity and SDK guidance rather than treating a production client secret or a hand-built exchange as interchangeable.
- Plan for expiration, revocation and replay. The W3C community document describes signature time windows and nonce/replay-cache guidance; the AIP draft discusses revocation. Define how expired or revoked credentials are handled and how a captured signed request is prevented from being reused.
- Do not treat identity controls as a defense against every agent risk. The AIP draft notes that identity mechanisms do not themselves prevent prompt injection. Tool permissions, application safeguards and review of consequential actions remain separate controls.
How to judge whether a proposal is ready to use
Protocol descriptions have different weight. RFC 8693 is a published IETF RFC for generic OAuth token exchange; it is not an agent-delegation profile. Microsoft’s materials are vendor documentation for Entra behavior. NIST’s February 2026 document is a concept paper seeking practical guidance and feedback, not a finished implementation profile. AIP is an IETF Internet-Draft, the DID-based HTTP document is a W3C Community Group document outside the W3C Standards Track, and the arXiv paper is a research proposal.
For a real deployment, confirm the exact profile and revision supported by both sides, the trust roots they use, the chain information the recipient validates, and the policy that maps claims to allowed actions. A protocol-shaped token or signature is not proof that separate organizations will interoperate or interpret delegated authority the same way.
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