diff --git a/internal/services/storage/storage_account_resource.go b/internal/services/storage/storage_account_resource.go
index 49eb2adb7528..a39bd4c7804e 100644
--- a/internal/services/storage/storage_account_resource.go
+++ b/internal/services/storage/storage_account_resource.go
@@ -15,6 +15,7 @@ import (
 
 	"github.com/Azure/azure-sdk-for-go/services/storage/mgmt/2021-09-01/storage" // nolint: staticcheck
 	azautorest "github.com/Azure/go-autorest/autorest"
+	"github.com/hashicorp/go-azure-helpers/lang/pointer"
 	"github.com/hashicorp/go-azure-helpers/lang/response"
 	"github.com/hashicorp/go-azure-helpers/resourcemanager/commonids"
 	"github.com/hashicorp/go-azure-helpers/resourcemanager/commonschema"
@@ -863,6 +864,12 @@ func resourceStorageAccount() *pluginsdk.Resource {
 				Computed: true,
 			},
 
+			"local_user_enabled": {
+				Type:     pluginsdk.TypeBool,
+				Optional: true,
+				Default:  true,
+			},
+
 			"primary_location": {
 				Type:     pluginsdk.TypeString,
 				Computed: true,
@@ -1351,6 +1358,7 @@ func resourceStorageAccountCreate(d *pluginsdk.ResourceData, meta interface{}) e
 			AllowCrossTenantReplication:  &crossTenantReplication,
 			SasPolicy:                    expandStorageAccountSASPolicy(d.Get("sas_policy").([]interface{})),
 			IsSftpEnabled:                &isSftpEnabled,
+			IsLocalUserEnabled:           pointer.To(d.Get("local_user_enabled").(bool)),
 		},
 	}
 
@@ -1819,6 +1827,17 @@ func resourceStorageAccountUpdate(d *pluginsdk.ResourceData, meta interface{}) e
 		}
 	}
 
+	if d.HasChange("local_user_enabled") {
+		opts := storage.AccountUpdateParameters{
+			AccountPropertiesUpdateParameters: &storage.AccountPropertiesUpdateParameters{
+				IsLocalUserEnabled: pointer.To(d.Get("local_user_enabled").(bool)),
+			},
+		}
+		if _, err := client.Update(ctx, id.ResourceGroupName, id.StorageAccountName, opts); err != nil {
+			return fmt.Errorf("updating `local_user_enabled` for %s: %+v", *id, err)
+		}
+	}
+
 	if d.HasChange("sftp_enabled") {
 		sftpEnabled := d.Get("sftp_enabled").(bool)
 
@@ -2285,6 +2304,13 @@ func resourceStorageAccountRead(d *pluginsdk.ResourceData, meta interface{}) err
 			d.Set("large_file_share_enabled", props.LargeFileSharesState == storage.LargeFileSharesStateEnabled)
 		}
 
+		// local_user_enabled defaults to true at service side when not specified in the API request.
+		isLocalEnabled := true
+		if props.IsLocalUserEnabled != nil {
+			isLocalEnabled = *props.IsLocalUserEnabled
+		}
+		d.Set("local_user_enabled", isLocalEnabled)
+
 		allowSharedKeyAccess := true
 		if props.AllowSharedKeyAccess != nil {
 			allowSharedKeyAccess = *props.AllowSharedKeyAccess
diff --git a/internal/services/storage/storage_account_resource_test.go b/internal/services/storage/storage_account_resource_test.go
index 9e3354260c8e..5fa555e2730d 100644
--- a/internal/services/storage/storage_account_resource_test.go
+++ b/internal/services/storage/storage_account_resource_test.go
@@ -1496,6 +1496,34 @@ func TestAccStorageAccount_isSftpEnabled(t *testing.T) {
 	})
 }
 
+func TestAccStorageAccount_isLocalUserEnabled(t *testing.T) {
+	data := acceptance.BuildTestData(t, "azurerm_storage_account", "test")
+	r := StorageAccountResource{}
+
+	data.ResourceTest(t, r, []acceptance.TestStep{
+		{
+			Config: r.isLocalUserEnabled(data, true),
+			Check: acceptance.ComposeTestCheckFunc(
+				check.That(data.ResourceName).ExistsInAzure(r),
+			),
+		},
+		data.ImportStep(),
+		{
+			Config: r.isLocalUserEnabled(data, false),
+			Check: acceptance.ComposeTestCheckFunc(
+				check.That(data.ResourceName).ExistsInAzure(r),
+			),
+		},
+		{
+			Config: r.isLocalUserEnabled(data, true),
+			Check: acceptance.ComposeTestCheckFunc(
+				check.That(data.ResourceName).ExistsInAzure(r),
+			),
+		},
+		data.ImportStep(),
+	})
+}
+
 func TestAccStorageAccount_minimalShareProperties(t *testing.T) {
 	data := acceptance.BuildTestData(t, "azurerm_storage_account", "test")
 	r := StorageAccountResource{}
@@ -4468,6 +4496,32 @@ resource "azurerm_storage_account" "test" {
 `, data.RandomInteger, data.Locations.Primary, data.RandomString)
 }
 
+func (r StorageAccountResource) isLocalUserEnabled(data acceptance.TestData, v bool) string {
+	return fmt.Sprintf(`
+provider "azurerm" {
+  features {}
+}
+
+resource "azurerm_resource_group" "test" {
+  name     = "acctestRG-storage-%d"
+  location = "%s"
+}
+
+resource "azurerm_storage_account" "test" {
+  name                = "unlikely23exst2acct%s"
+  resource_group_name = azurerm_resource_group.test.name
+
+  location                 = azurerm_resource_group.test.location
+  account_kind             = "StorageV2"
+  account_tier             = "Standard"
+  account_replication_type = "LRS"
+  is_hns_enabled           = true
+  sftp_enabled             = true
+  local_user_enabled       = %t
+}
+`, data.RandomInteger, data.Locations.Primary, data.RandomString, v)
+}
+
 func (r StorageAccountResource) blobPropertiesStorageKindNotSupportLastAccessTimeEnabled(data acceptance.TestData) string {
 	return fmt.Sprintf(`
 provider "azurerm" {
diff --git a/website/docs/r/storage_account.html.markdown b/website/docs/r/storage_account.html.markdown
index b35b752051ea..83a120eea1b9 100644
--- a/website/docs/r/storage_account.html.markdown
+++ b/website/docs/r/storage_account.html.markdown
@@ -148,6 +148,8 @@ The following arguments are supported:
 
 * `large_file_share_enabled` - (Optional) Is Large File Share Enabled?
 
+* `local_user_enabled` - (Optional) Is Local User Enabled? Defaults to `true`.
+
 * `azure_files_authentication` - (Optional) A `azure_files_authentication` block as defined below.
 
 * `routing` - (Optional) A `routing` block as defined below.