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The archive mailbox is an additional mailbox that's enabled for an account where messages older than 2 years are automatically moved (this can be customized in the retentionpolicy). This keeps the everyday mailbox at a more manageable level and allows for faster indexing and email searches.

Some power users will familiar with archiving in Outlook as they may have crossed this issue in the past. They archive the email older than 2 years into a pst file. That pst file will show as a separate set of folders on the left hand side.

In-Place Archive is very similar. However, where this different is that in-place archive is controlled by the Exchange administrator and does not require user intervention. The Exchange administrator can turn archiving on/off on the fly and control where the archive mailbox lives; this can be placed on the same edb or a different edb.

Here's how to enable archiving:

enable-mailbox foo.user -archive

Here's how to see what accounts have archive enabled:

get-mailbox -Filter {ArchiveState -Eq 'local'}

If you want to get the pertinent details of the archive such as archive database and archivename:

get-mailbox -Filter {ArchiveState -Eq 'local'} |select alias,archivestate,archivedatabase,archivename,retentionpolicy |fl

Here's how to enable unlimited archiving for the entire company:

Set-OrganizationConfig -AutoExpandingArchive

Here's how to enable unlimited archiving for a single account:

enable-mailbox foo.user -AutoExpandingArchive

Here's how to get the quota on a mailbox:

get-mailbox foo.user |Select *quota

365 Basic / 365 Standard / 365 Premium have a limit of 50GB for mailboxes. If you upgrade to an E3 or E5 license, you can upgrade the quota limits via powershell:

set-mailbox foo.user -ProhibitSendQuota 100GB -ProhibitSendReceiveQuota 100GB -IssueWarningQuota 98GB

Note that I tried this on 356-Standard and it does not work.

NOTES:

https://docs.microsoft.com/en-us/exchange/policy-and-compliance/in-place-archiving/manage-archives

https://docs.microsoft.com/en-us/exchange/policy-and-compliance/mrm/apply-retention-policies-to-mailboxes

https://docs.microsoft.com/en-us/microsoft-365/compliance/unlimited-archiving

https://docs.microsoft.com/en-us/office365/servicedescriptions/exchange-online-archiving-service-description/exchange-online-archiving-service-description