Just as Windows 2000 and Windows 2003 had their own functional levels that ensured down-level compatibility with legacy domain versions, Windows Server 2008 R2 has its own functional levels that are used to maintain compatibility. The following functional levels exist in Windows Server 2008 R2:
. Windows 2000 Native functional level—This functional level allows Windows Server 2008 R2 domain controllers to coexist with both Windows 2000 SP3+ and Windows 2003 domain controllers within a forest.
. Windows Server 2003 functional level—This functional level allows Windows 2003 and Windows Server 2008 R2 domain controllers to coexist. Additional functionality is added to the forest, including cross-forest transitive trust capabilities and replication enhancements.
. Windows Server 2008 functional level—In this functional level, all domain controllers must be running Windows Server 2008 or later. Changing the domain and forest functional level to Windows Server 2008 adds additional functionality, such as fine-grained password policies.
. Windows Server 2008 R2 functional level—In this functional level, all domain controllers must be running Windows Server 2008 R2. Changing the forest functional level to this latest AD DS level grants Windows Server 2008 R2 feature functionality, such as access to the Active Directory Recycle Bin.
By default, a fresh installation of Active Directory on Windows Server 2008 R2 domain controllers allows you to choose which functional level you want to start the forest in. If an existing forest is in place, it can be brought to Windows Server 2008 R2 functional level by performing the following steps:
1. Ensure that all domain controllers in the forest are upgraded to Windows Server 2008 R2 or replaced with new Windows Server 2008 R2 DCs.
2. Open Active Directory Domains and Trusts from the Administrative Tools menu on a domain controller.
3. In the left scope pane, right-click on the domain name, and then click Raise Domain Functional Level.
4. In the box labeled Raise Domain Functional Level, select Windows Server 2008 R2, and then click Raise.
5. Click OK and then click OK again to complete the task.
6. Repeat steps 1–5 for all domains in the forest.
7. Perform the same steps on the root node of Active Directory Domains and Trusts, except this time choose Raise Forest Functional Level and follow the prompts.
When all domains and the forest level have been raised to Windows Server 2008 R2 functionality, the forest can take advantage of the latest AD DS functionality, such as the Active Directory Recycle Bin, outlined in more detail later in this chapter. Remember, before you accomplish this task, Windows Server 2008 R2 essentially operates in a downgraded mode of compatibility.
Source of Information : Sams - Windows Server 2008 R2 Unleashed