Unable To Create VM In Region In Which my Policy Assignment ALLOWS - Student Account

The behavior is caused by subscription-level region restrictions and capacity policies, not by the Azure Policy assignment that lists East US as allowed.

Two different mechanisms are in effect:

1. Region access / optimization policy
   Azure can restrict which regions a subscription is allowed to use, or temporarily block new customers from specific regions. When that happens, attempts to deploy in a blocked region show errors like: “Your subscription doesn't support virtual machine creation in East US. Choose a different location” or “This policy maintains a set of best available regions where your subscription can deploy resources.” This is independent of any custom Azure Policy. Even if a policy allows eastus, the subscription itself can still be ineligible for that region.
2. Location ineligible / capacity controls
   For some regions, Microsoft prioritizes capacity for existing customers. New or specific subscription types (including some student offers) can be blocked from creating resources in those regions until access is granted. This is the same class of issue described for other regions in the documentation.

To fix or work around the issue:

1. Try an alternative allowed region
   Use one of the regions that both:
   • Appear in the VM creation region dropdown, and
   • Are not blocked by the “best available regions” optimization message.
   If at least one such region works, use it for your lab/project.
2. If no region works (current situation), open a support request
   Because the subscription is effectively blocked from creating resources, this must be remediated by Microsoft support:
   • Sign in to the Azure portal.
   • Create a new support request.
   • For the problem type, choose something like Service and subscription limits (quotas) or Region access (wording varies), and clearly state:
     • Subscription type (Azure for Students).
     • Exact error messages.
     • That the policy assignment allows eastus but the subscription cannot deploy there and cannot deploy in any other region either.
   • Ask for region access remediation or clarification of which regions are enabled for the subscription.
   This follows the same pattern as the documented remediation flow for region-access and region-optimization policies, where support can adjust which regions are available when there is a valid need.

Until support updates the subscription’s region access, VM creation will continue to fail regardless of the Azure Policy configuration.

References:

• Resolve location ineligible errors
• Region optimization for Microsoft Azure customers
• Common issues: Unavailable virtual machine SKU
• Troubleshoot allocation failures when you create or resize VMs in Azure
• Regions for virtual machines in Azure
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