Windows Server 2008  includes a handful of important upgrades to your Active Directory domain infrastructure. The most useful are these:
You can take advantage of these improvements only by upgrading every domain controller in a domain to Windows Server 2008, and then upgrading the domain functional level. That sounds easy, but if you don’t plan it properly, you could be left with a broken Active Directory and thousands of angry users. Follow these tips to upgrade without fear.
While most upgrades go smoothly, there’s the possibility of creating an outage that could affect your entire domain — potentially preventing users from accessing network resources. The more customized your Active Directory schema and permissions, the more likely you are to have problems. Therefore, you should plan your upgrade during nonpeak hours and have a full backup (including System State) of at least two domain controllers  in case you need to roll back to an earlier version.
Before you can upgrade the domain functional level, all domain controllers in the domain must be running Windows Server 2008. This allows you to take advantage of the new features but prevents you from adding any domain controllers running earlier versions of Windows.
Before you start upgrading, verify that your domain controllers meet these requirements:
Active Directory domains are very resilient and can continue to function even when a variety of problems exist. Even if your Active Directory seems to be working, you might have logon delays, replication failures or Group Policy settings that aren’t being applied. These conditions can cause problems during an upgrade, so it’s important to resolve them now.
These tools will help you identify and diagnose any problems:
Just as when upgrading to a Windows Server 2003 functional level, you must use the Adprep.exe tool to prepare your forest and domain schema. Note that you must use the version of Adprep included on the Windows Server 2008 media in the \sources\adprep folder, even though you will need to run it from an existing Windows Server 2003 domain controller. Be sure to use 32-bit media when running Adprep from a 32-bit domain controller, and use 64-bit media for 64-bit domain controllers.
To prepare your Active Directory schema, follow these steps for each domain that you plan to upgrade:
Note: As long as your domain and forest are at the Windows Server 2003 functional level and you’ve prepared the schema, you don’t need to upgrade your entire domain to install a Windows Server 2008 RODC.
Before you upgrade a domain, be sure that you don’t plan to add domain controllers running Windows 2000 Server or Windows Server 2003. While you can always upgrade the domain functional level, you can never downgrade it.
The easiest way to migrate your domain to the Windows Server 2008 functional level is to follow these steps:
Now, test any applications that depend on Active Directory, including user logons and Exchange Server. If you run into problems, restore your domain controllers from backups, and head back to the lab for more testing. If everything goes well, wait a couple of weeks for the environment to stabilize before you make any other major changes.
There are no new features available if you upgrade your forest to the Windows Server 2008 functional level — it just causes any new domains that are added to the forest to be at the Windows Server 2008 domain functional level by default. Still, it’s a worthwhile step to save yourself the trouble of upgrading a new domain that you accidentally added at the wrong functional level.
Microsoft must have been listening to the complaints about Active Directory limitations because Windows Server 2008 allows multiple password policies within a domain, read-only domain controllers and auditing that’s actually useful. If you follow these steps, you’ll be finished with your upgrade in no time.