after successfully adding an AD domain as an identity source in vcenter i was unable to expand a listing of domain users and groups from within the vcenter SSO settings. this also failed when i tried to set up vcenter permissions for domain users.  i kept receiving this message: “error while extracting local sso users”.

i eventually found out this problem is caused by domain controllers missing reverse lookup DNS records. once i added the missing records in DNS this problem was resolved.

source:
https://communities.vmware.com/thread/506270?start=0&tstart=0

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