A new feature is being rolled out to allow you to convert your distribution lists to Office 365 Groups.
What can be converted to Office 365 Groups
The following table defines what can be converted (as of today – August 5th, 2016)
| Distribution Group Types | Eligibility |
|---|---|
| Mail enabled security group. | Not eligible |
|
On-premise managed distribution group. (synched) |
Not eligible |
|
Nested distribution groups. Distribution group either has child groups or is a member of another group. |
Not eligible |
|
Moderated distribution group |
Not eligible |
|
Distribution groups with send on behalf settings |
Not eligible |
|
Distribution groups hidden from address lists |
Not eligible |
|
Distribution groups with member RecipientTypeDetails other than UserMailbox, SharedMailbox, TeamMailbox, MailUser |
Not eligible |
|
Distribution groups with member join or depart restriction as Closed |
Eligible. Converted to a private Office 365 Group. |
|
Distribution groups with custom delivery status notifications. ReportToManager = true, ReportToOriginator = false ReportToManager = false, ReportToOriginator = false |
Eligible. Office 365 Groups don’t understand these properties, and delivery status notifications are always sent to the person that sent the email. |
Convert a distribution group
Logon to your Exchange Online ECP (https://outlook.office365.com/ecp/) and reach the Recipients\Groups section
Select the distribution group you want to convert to Office 365 – please refer to the table – and click the Upgrade to Office 365 Groups button
Don’t worry, if the distribution list is NOT eligible, this button will not be available
Confirm you want to convert to Office 365 Groups – thankfully if anything goes wrong, the DL will not be changed
Then the conversion may take some time
Please note it may take some time also to refresh the Office 365 Admin portal; this means you may see twice your DL/Office 365 groups – one distribution list and one Office 365 Groups; if you try to select the former distribution group you will got an error 
