Create an Azure VM with Terraform: A Step-by-Step Guide.

Introduction

Infrastructure as Code (IaC) is essential for managing cloud infrastructure efficiently. Terraform, an open-source IaC tool, allows you to define, deploy, and manage Azure resources in a repeatable and automated way.

In this guide, we’ll walk through deploying an Azure Virtual Machine (VM) using Terraform, covering:

✔ Defining a resource group
✔ Creating a virtual network and subnet
✔ Configuring a public IP and network interface
✔ Deploying a Windows Virtual Machine
✔ Running Terraform commands to provision infrastructure

By the end, you’ll have a fully functional Azure VM managed via Terraform, making deployments more efficient and scalable. 🚀

Prerequisites

Before getting started, ensure you have:
✅ An active Azure subscription
✅ Azure CLI installed (az --version)
✅ Terraform installed (terraform -v)
✅ Editor (VS Code recommended with Terraform extension)

Step 1: Initialize the Terraform Project

Create a new directory for your Terraform project and navigate into it:

1

mkdir terraform-azure-vm && cd terraform-azure-vm

Create the Terraform configuration file:

1

touch main.tf

Open main.tf in your editor to begin defining your infrastructure.

Step 2: Configure the Azure Provider

At the top of main.tf, define the Azure provider:

1
2
3

provider "azurerm" {
  features {}
}

This tells Terraform to use the Azure Resource Manager (AzureRM) provider for managing Azure resources.

Step 3: Define the Resource Group

A Resource Group is required to organize and manage related Azure resources. Define it in main.tf:

1
2
3
4
5
6
7
8
9

resource "azurerm_resource_group" "rg" {
  name     = "terraform-rg"
  location = "northeurope"
  
  tags = {
    environment = "demo"
    owner       = "terraform-user"
  }
}

Step 4: Create a Virtual Network and Subnet

Define a Virtual Network (VNet) and Subnet for networking within the Resource Group:

 1
 2
 3
 4
 5
 6
 7
 8
 9
10
11
12
13

resource "azurerm_virtual_network" "vnet" {
  name                = "terraform-vnet"
  location            = azurerm_resource_group.rg.location
  resource_group_name = azurerm_resource_group.rg.name
  address_space       = ["10.0.0.0/16"]
}

resource "azurerm_subnet" "subnet" {
  name                 = "terraform-subnet"
  resource_group_name  = azurerm_resource_group.rg.name
  virtual_network_name = azurerm_virtual_network.vnet.name
  address_prefixes     = ["10.0.1.0/24"]
}

Step 5: Configure a Public IP Address

To allow external access, create a Public IP address:

1
2
3
4
5
6
7

resource "azurerm_public_ip" "public_ip" {
  name                = "terraform-public-ip"
  location            = azurerm_resource_group.rg.location
  resource_group_name = azurerm_resource_group.rg.name
  allocation_method   = "Static"
  sku                 = "Standard"
}

Step 6: Define a Network Interface (NIC)

The VM needs a Network Interface (NIC) to connect to the Subnet and Public IP:

 1
 2
 3
 4
 5
 6
 7
 8
 9
10
11
12

resource "azurerm_network_interface" "nic" {
  name                = "terraform-nic"
  location            = azurerm_resource_group.rg.location
  resource_group_name = azurerm_resource_group.rg.name

  ip_configuration {
    name                          = "terraform-nic-config"
    subnet_id                     = azurerm_subnet.subnet.id
    private_ip_address_allocation = "Dynamic"
    public_ip_address_id          = azurerm_public_ip.public_ip.id
  }
}

Step 7: Define the Virtual Machine

Before defining the VM, create variables for secure credential handling:

 1
 2
 3
 4
 5
 6
 7
 8
 9
10
11

variable "admin_username" {
  type        = string
  description = "The administrator username for the VM"
  default     = "azureadmin"
}

variable "admin_password" {
  type        = string
  description = "The administrator password for the VM"
  sensitive   = true
}

Now, define the Windows Virtual Machine:

 1
 2
 3
 4
 5
 6
 7
 8
 9
10
11
12
13
14
15
16
17
18
19
20
21

resource "azurerm_windows_virtual_machine" "vm" {
  name                  = "terraform-vm"
  location              = azurerm_resource_group.rg.location
  resource_group_name   = azurerm_resource_group.rg.name
  network_interface_ids = [azurerm_network_interface.nic.id]
  size                  = "Standard_B2s"
  admin_username        = var.admin_username
  admin_password        = var.admin_password

  source_image_reference {
    publisher = "MicrosoftWindowsServer"
    offer     = "WindowsServer"
    sku       = "2019-Datacenter"
    version   = "latest"
  }

  os_disk {
    caching              = "ReadWrite"
    storage_account_type = "Standard_LRS"
  }
}

Step 8: Deploy the Virtual Machine with Terraform

1️⃣ Authenticate with Azure

Log in using the Azure CLI:

1

az login

If you have multiple subscriptions, set the correct one:

1
2

az account list --output table
az account set --subscription "Your Subscription Name"

2️⃣ Initialize Terraform

Run terraform init to prepare Terraform for deployment:

1

terraform init

3️⃣ Preview Changes with Terraform Plan

1

terraform plan -out=tfplan

4️⃣ Apply the Terraform Configuration

1

terraform apply tfplan

Step 9: Get the VM Public IP and Connect

Retrieve the public IP:

1

terraform output

Use Remote Desktop (RDP) to connect to the Windows VM:

1

mstsc /v:<VM_PUBLIC_IP>

Step 10: Clean Up Resources

1

terraform destroy

Conclusion

We successfully deployed an Azure Virtual Machine using Terraform, covering:

✅ Infrastructure as Code (IaC) principles
✅ Defining a Virtual Network, Subnet, and Public IP
✅ Deploying a Windows VM securely
✅ Running Terraform commands to manage resources

Next Steps:

🔹 Use Azure Key Vault to store secrets securely.
🔹 Implement remote state management using Azure Storage.
🔹 Set up CI/CD pipelines with GitHub Actions for automated deployments.

🚀 Have any questions or suggestions? Drop them in the comments! 💬

🔥 Want to automate more Azure resources? Stay tuned for future Terraform guides! 🚀