How to Create an Azure Resource Group with Terraform

In this lab, you create an Azure resource group with Terraform. The configuration is small, reusable, and available as a download.

Goal

Create rg-azfundamentals-lab in West Europe with a simple Terraform configuration.

Requirements

You need:

• An active Azure subscription
• Terraform installed
• Azure CLI installed
• Permission to create resource groups

Microsoft documents Azure CLI authentication as a supported way to authenticate Terraform to Azure. For automation, use an identity designed for the workload and do not save secrets in the Terraform files.

Download the code

The repository contains these files:

Authenticate to Azure

Sign in with the Azure CLI:

az login

Check the active subscription:

az account show --output table

Set the correct subscription when needed:

az account set --subscription "YOUR_SUBSCRIPTION_ID"

Terraform configuration

The provider version is constrained to AzureRM 4.x. The subscription ID is passed as a variable, so it is not hardcoded in the configuration.

versions.tf

terraform {
  required_version = ">= 1.8.0"

  required_providers {
    azurerm = {
      source  = "hashicorp/azurerm"
      version = "~> 4.0"
    }
  }
}

providers.tf

provider "azurerm" {
  features {}

  subscription_id = var.subscription_id
}

main.tf

resource "azurerm_resource_group" "this" {
  name     = var.resource_group_name
  location = var.location

  tags = var.tags
}

variables.tf

variable "subscription_id" {
  description = "Azure subscription ID used by the AzureRM provider."
  type        = string
}

variable "resource_group_name" {
  description = "Name of the Azure resource group."
  type        = string
  default     = "rg-azfundamentals-lab"
}

variable "location" {
  description = "Azure region used for the resource group metadata."
  type        = string
  default     = "westeurope"
}

variable "tags" {
  description = "Tags applied to the resource group."
  type        = map(string)
  default = {
    environment = "lab"
    managed_by  = "terraform"
  }
}

Prepare the variable file

Copy the example file:

cp terraform.tfvars.example terraform.tfvars

On Windows PowerShell:

Copy-Item terraform.tfvars.example terraform.tfvars

Open terraform.tfvars and add your subscription ID:

subscription_id = "00000000-0000-0000-0000-000000000000"

The .gitignore file excludes terraform.tfvars and Terraform state files. Do not commit credentials or sensitive values.

Run Terraform

Initialize the working directory:

terraform init

Format and validate the files:

terraform fmt
terraform validate

Review the plan:

terraform plan

Create the resource group:

terraform apply

Read the plan before entering yes.

Validate the result

You can check the output:

terraform output

You can also open Resource groups in the Azure Portal and confirm that rg-azfundamentals-lab exists with the expected tags.

Remove the lab

When the test is complete, run:

terraform destroy

Review the plan and confirm only when the resource group contains no data you need.

Official documentation

• HashiCorp: Build Azure infrastructure with Terraform
• Terraform Registry: azurerm_resource_group
• Terraform Registry: AzureRM provider
• Microsoft Learn: Authenticate Terraform to Azure
• HashiCorp: AzureRM backend