In many cases, it may be appropriate or even necessary for a subset of your users to be able to share resources with external users while prohibiting others. For example, you may want to allow individuals in the marketing department to collaborate with an outside ad agency, but restrict line workers from doing so.

To manage this setting, click the Limit external sharing to specific security groups link on the SharePoint Admin Center | Sharing page. This will take you to the classic External Sharing settings page, as shown in the following screenshot. You can also reach this page by navigating to https://<tentant>-admin.sharepoint.com/_layouts/15/online/ExternalSharing.aspx:

There are two settings available under Who can share outside your organization:

• Let only users in selected security groups share with authenticated external users
• Let only users in selected security groups share with authenticated external users and use anonymous links

Selecting either of those checkboxes will allow you to enter the names of one or more security groups to allow users in those groups to share.

As you configure the sharing options for your organization, ensure that you review all of the settings after saving them to make sure none of your choices were overridden by other selections. This is especially important when you are configuring options between both the modern and classic interfaces since not all the options are present in both.