Azure Functions Hosted Skills

Azure Functions Hosted Skills are a medium-code programming model for building cloud-hosted, event-driven intelligent capabilities on Azure Functions. Start with Markdown, natural-language instructions, and declarative configuration, then add code, tools, functions, bindings, business logic, and Azure integrations when the scenario needs more control.

Each Hosted Skill runs within an Azure Functions application and can react to HTTP requests, messages, schedules, data changes, and other Functions triggers. It uses the Functions foundation for deployment, event-driven scale, identity, networking, monitoring, and operations, and can expose capabilities through HTTP or MCP for applications, agents, and agent harnesses.

Azure Functions hosts and manages the skill in the cloud, so it remains available after deployment instead of depending on a developer laptop or local process. Lead customer conversations with this programming model and the customer's end-to-end scenario and success criteria, rather than trying to categorize the product. Hosted Skills complement other Microsoft AI offerings and can be used with them.