To migrate to Azure and decommission the on-premises data center, you would need to create the 5,000 user accounts in Azure Active Directory. The easy way to do this is to sync all the Active Directory user accounts to Azure Active Directory (Azure AD). You can even sync their passwords to further minimize the impact on users.
The tool you would use to sync the accounts is Azure AD Connect. The Azure Active Directory Connect synchronization services (Azure AD Connect sync) is a main component of Azure AD Connect. It takes care of all the operations that are related to synchronize identity data between your on-premises environment and Azure AD.
https://docs.microsoft.com/en-us/azure/active-directory/hybrid/how-to-connect-sync-whatis

A network security group works like a firewall. You can attach a network security group to a virtual network and/or individual subnets within the virtual network. You can also attach a network security group to a network interface assigned to a virtual machine. You can use multiple network security groups within a virtual network to restrict traffic between resources such as virtual machines and subnets.
You can filter network traffic to and from Azure resources in an Azure virtual network with a network security group. A network security group contains security rules that allow or deny inbound network traffic to, or outbound network traffic from, several types of Azure resources.
https://docs.microsoft.com/en-us/azure/virtual-network/security-overview