Every Dataverse record has a unique GUID that Dataverse uses as its primary Key. An alternate key lets you identify a Dataverse record using a unique business value instead of its GUID. It is mainly useful when working with external systems.
A customer may have a Dataverse GUID like 7a8f…, but an ERP system identifies the same customer as CUST1001. You can create an alternate key using CustomerID and use CUST1001 to find or update that customer in Dataverse.
In short:
GUID = Dataverse record ID.
Alternate key = business ID used to identify the record.
Interview tip:
Use an alternate key when an external system already has a unique ID for the record and you don’t want to depend on the Dataverse GUID.
