Active Directory is essential to any Microsoft network built on the
client-server network model–it allows you to have a central sever called
a Domain Controller (DC) that does authentication for your entire
network. Instead of people logging on to the local machines they
authenticate against your DC. Lets take a look at how to install
Microsoft’s Active Directory.

Installation

Open Server Manager and click on roles, this will bring up the Roles
Summary on the right hand side where you can click on the Add Roles
link.

This will bring up the Add Roles Wizard where you can click on next
to see a list of available Roles. Select Active Directory Domain
Services from the list, you will be told that you need to add some
features, click on the Add Required Features button and click next to
move on.

A brief introduction to Active Directory will be displayed as well as
a few links to additional resources, you can just click next to skip
past here and click install to start installing the binaries for Active
Directory.

When the installation is finished you will be shown a success message, just click close.

Configuration

Open up Server Manager, expand Roles and click on Active Directory
Domain Services. On the right hand side click on the Run the Active
Directory Domain Services Installation Wizard (dcpromo.exe) link.

This will kick off another wizard, this time to configure the settings for you domain, click next to continue.

The message that is shown now relates to older clients that do not
support the new cryptographic algorithms supported by Server 2008 R2,
these are used by default in Server 2008 R2, click next to move on.

Choose to create a new domain in a new forest.

Now you can name your domain, we will be using a .local domain the reason why will be explained in an upcoming article.

Since this is the first DC in our domain we can change our forest functional level to Server 2008 R2.

We want to include DNS in our installation as this will allow us to
have an AD Integrated DNS Zone, when you click next you will be prompted
with a message just click yes to continue.

You will need to choose a place to store log files, it is a best
practice to store the database and SYSVOL folder on one drive and the
log files on a separate drive, but since this is in a lab environment I
will just leave them all on the same drive.

Choose a STRONG Active Directory Restore Mode Password and click next twice to kick off the configuration.

You will be able to see what components are being installed by looking in the following box.

When its done you will be notified and required to reboot your PC.

That’s all  there is to it guys, now you have a working installation of Active Directory.