Hi ntozier 
We enabled the security defaults, then disabled the MFA per user after registering a MFA for the specific account.
The email setup for the specific user on M365:
- Security default is enabled in whole organization, so it will require the users to input MFA on first login.
 
- After creating this specific user, I registered a MFA for it, then disabled the MFA for it so it won't require anymore 2FA in the future.
 
- Enabled SMTP Authentication for the specific user
 
On osTicket:
- I used Username and Password I defined on M365
 
- Used smtp.office365.com as SMTP host server
 
- Used port 587 for SMTP host
 

This is the error I am getting upon doing the above settings.