By default, the FTP service will use the local user database on the server itself (unless you enter your username in the domain\username format), you can however configure IIS to use a domain by default.
Take caution in doing this though, if you’ve ever put an FTP server on the internet, take a look at the event logs, it will have a ton of brute force attacks on it within minutes.
By default FTP will be trying to authenticate locally, which is a much smaller attack surface (fewer users) as soon as you point it at your domain, it’s going to have a much larger attack surface (more users)
You need to make sure you don’t have any accounts such as “test” or users like “mary” with passwords of “password” or any dictionary word at all. You should also tie the FTP site down to the specific users that need access, so if an account does get compromised it can’t be used to put data in the FTP directory.
With the above in mind, use an elevated command prompt to run the following on the FTP server
adsutil set msftpsvc/DefaultLogonDomain "YourDomainName"This will set the default logon domain for all FTP sites.