This article explains:
In order to access Teams within Virginia Tech, the user (internal or external) is required to have an account within Virginia Tech’s Azure Active Directory (VT’s AAD). Therefore, when an external user is invited to a Team, they are invited as a Guest. During this process, they'll receive an invitation email link. Clicking on that link opens the Microsoft 365 (M365) portal using that email address as a login. If the email address does not exist as a Microsoft account within VT’s AAD, the user will be given a notice that reads:
"Looks like you don’t have an account with us. We'll create one for you using [email address]".
It'll then ask you to create a password for that account. This will create the required limited account within VT’s AAD. They will be able to access only the resources made available to them, in this case, VT Teams. Generally, guests will see Team conversations, be able to access Team files, and participate in Team online meetings. However, they need an M365 account in their own organization to participate fully.
It is important to make the guest aware that they must authenticate using the account that was in the actual invitation. If they authenticate with a different account, it will appear as if they are members, but not actually be able to log in.
In addition to Guests, two other roles are available in Teams. They are Owners and Members:
Please refer to the following links for more information: