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Veeam Backup and OneDrive / External file storage

Source: and Veeam vendor support!

Understanding OneDrive File States

Only local files can be read and backed up by Veeam. If a file is stored only in OneDrive (or on a Synology NAS that has a similar feature as OneDrive "Files On-Demand"), such files have the "little cloud" icon overlay. This file is not actually on the hard drive of your machine. There is only a place holder of it. In case you need a restore of your files, such files will make the restore process stuck: Veeam will be expecting a stream of data (as big as the file) but there is nothing there - nothing to restore: the restore is stuck... (Even Veeam vendor support cannot help restore your files, in such a case.)

More information about file states can be found in Microsoft documentation here.

To create restorable / workable backups of your files, you need to make your files to be fully local.

Online-Only File icon with little blue cloud
Online-Only File
(Files On-Demand Enabled)
On-Demand Local File
Locally Available File
(Files On-Demand Enabled)
Always Local File
Always Available File
(Filess On-Demand Disabled)


Force all files and folders in OneDrive to be kept local

  1. Right-click the OneDrive icon in the notification area or the File Explorer.


  2. Go to Settings > the "Settings" tab.


  3. Under Files On-Demand, clear the "Save space and download files as you use them" check box.


  4. Click OK twice.


After that, all the OneDrive files will be downloaded to the computer and available for Veeam to be backed up.