Use the Microsoft 365 Defender portal to remove a user from the Restricted users list
Go directly to the Restricted users page, use https://security.microsoft.com/restrictedusers.
On the Restricted users page, find and select the user that you want to unblock by clicking on the user.
Click the Unblock action that appears.
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In the Unblock user flyout that appears, read the details about the restricted account. You should go through the recommendations to ensure you're taking the proper actions in case the account is compromised.
When you're finished, click Next.
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The next screen has recommendations to help prevent future compromise. Enabling multi-factor authentication (MFA) and resetting the password are a good defense.
When you're finished, click Submit.
Click Yes to confirm the change.