If the information provided is useful, please do accept the answer and upvote so as to increase discoverability of this answer with other users facing similar issue. The above details were as per my past experience with app passwords. So I can conclude that enforcing the MFA enables this. When I enforced the MFA for the user account, I started getting the App password option in the available methods dropdown as below on My security info page.

I was unable to get app password method show up for my administrator account which had MFA enabled from the MFA administration page. On user accounts enforcing the MFA settings works. The Ap passwords are not available if Security defaults are enabled. Please check if you have these enabled from the Azure portal by checking Azure active directory blade. If this does not work please try to enforce the MFA settings as shown below from the MFA administration panel.Īnother reason what I have seen is that having security defaults can cause disabling of app password options. Sign out the user from all sessions using the Microsoft 365 Admin portal. Select the user and click on manage user settings. Please go to the MFA Administration Page using your global administrator account. Could you please try resetting the MFA settings for the user once.

Sometimes there are transient issues and it could prevent form the app password option showing up in the My signin Page.

App passwords office 365