Users on an on-premise AD domain controller and use Office 365 Exchange Online

Question

Is it possible to create Users on an on-premise AD domain controller and use "Office 365 Exchange Online" as the Exchange server with out creating the users on Office 365? or does one has to have it on both for to work?

Answer 1

Here's an overview for setting up directory sync for on-premises AD and O365.

And here's the Technet article that seems to walk you through each step.