A new zero-day vulnerability in NTLM discovered by researchers at 0patch allows attackers to steal NTLM credentials by having a user view a specially crafted malicious file in Windows Explorer — no need for the user to open the file. These password hashes can be used for authentication relay attacks or for dictionary attacks on the password, both for identity takeover.
NTLM refers to a suite of old authentication protocols from Microsoft that provide authentication, integrity, and confidentiality to users. While NTLM was officially deprecated as of June, our research shows that 64% of Active Directory user accounts regularly authenticate with NTLM — evidence that NTLM is still widely used despite its known weaknesses.
The flaw is exploitable even in environments using NTLM v2, making it a significant risk to enterprises that have not yet moved to Kerberos and are still relying on NTLM. Considering Microsoft may not patch this issue for a while, enterprise defenders should take steps to mitigate the vulnerability in their environments. This Tech Tip outlines how dynamic access policies, a few hardening steps, and multifactor authentication (MFA) can help limit attempts to exploit this vulnerability. Upgrading the protocol, where possible, could eliminate the issue completely.
What Is the NTLM Vulnerability?
When a user views a malicious file in Windows Explorer — whether by navigating to a shared folder, inserting a USB drive containing the malicious file, or just viewing a file in the Downloads folder that was automatically downloaded from a malicious Web page — an outbound NTLM connection is triggered. This causes Windows to automatically send NTLM hashes of the currently logged-in user to a remote attacker-controlled share.
These NTLM hashes can then be intercepted and used for authentication relay attacks or even dictionary attacks, granting attackers unauthorized access to sensitive systems. Attackers can also potentially use the exposed passwords to access the organization’s software-as-a-service (SaaS) environment due to the high rates of synced users.
The issue impacts all Windows versions from Windows 7 and Server 2008 R2 up to the latest Windows 11 24H2 and Server 2022.
The fundamental problem with NTLM lies in its outdated protocol design. NTLM transmits password hashes instead of verifying plaintext passwords, making it vulnerable to interception and exploitation. Even with NTLM v2, which uses stronger encryption, the hashes can still be captured and relayed by attackers. NTLM’s reliance on weak cryptographic practices and lack of protection against relay attacks are key weaknesses that make it highly exploitable. Moreover, NTLM authentication does not support modern security features, such as MFA, leaving systems open to a variety of credential theft techniques, such as pass-the-hash and hash relaying.
What Defenders Need to Do
To mitigate this vulnerability, Microsoft has updated previous guidance on how to enable Extended Protection for Authentication (EPA) on LDAP, Active Directory Certificate Services (AD CS), and Exchange Server. On Windows Server 2022 and 2019, administrators can manually enable EPA for AD CS and channel binding for LDAP. There are scripts provided by Microsoft to activate EPA manually on Exchange Server 2016. Where possible, update to the latest Windows Server 2025 as it ships with EPA and channel binding enabled by default for both AD CS and LDAP.
Some organizations may still be dependent on NTLM due to legacy systems. Those teams should consider additional authentication layers, such as dynamic risk-based policies, for protecting existing NTLM legacy systems against exploitations.
Harden LDAP configurations. Configure LDAP to enforce channel binding and monitor for legacy clients that may not support these settings.
Check impact on SaaS. If you are unsure whether there are applications or clients in your environment that rely on NTLMv2, you can use Group Policy to enable the Network Security: Restrict NTLM: Audit incoming NTLM traffic policy setting. This will not block NTLMv2 traffic but will log all attempts to authenticate using NTLMv2 in the Operations Log. By analyzing these logs, you can identify which client applications, servers, or services still rely on NTLMv2, so you can make targeted adjustments or updates.
Using Group Policy to limit or disable NTLM authentication via the Network Security: Restrict NTLM setting will reduce the risk of fallback scenarios where NTLM is unintentionally used.
Monitor SMB traffic. Enabling SMB signing and encryption can help prevent attackers from impersonating legitimate servers and triggering NTLM authentication. Blocking outbound SMB traffic to untrusted networks will also reduce the risk of NTLM credential leakage to rogue servers. Implement network monitoring and alerting for unusual SMB traffic patterns, particularly outbound requests to unknown or untrusted IP addresses.
Leave NTLM behind. NTLM has been deprecated. Administrators should audit NTLM usage to identify which systems still rely on NTLM. Organizations should prioritize transitioning those systems away from NTLM to more modern authentication protocols, such as Kerberos. Once a more modern protocol is in place, implement MFA to add an additional layer of protection.
Taking these steps will help organizations address the fundamental flaws in NTLM and improve their security posture.
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