DE.AE-02: Potentially adverse events are analyzed to better understand associated activities

DE.AE-02 requires you to take every potentially adverse cybersecurity event (not just confirmed incidents) and analyze it to understand what happened, how it happened, what else it touched, and what to do next. Operationalize it by defining triage and investigation criteria, performing repeatable event analysis, and retaining defensible evidence of decisions, findings, and follow-up actions. (NIST CSWP 29)

Key takeaways:

• Treat “potentially adverse events” as investigation candidates, not noise; analyze patterns, scope, and likely causes. (NIST CSWP 29)
• Make analysis repeatable: documented workflow, roles, required fields, and defined outputs (impact, root cause hypothesis, containment actions). (NIST CSF 2.0)
• Evidence matters: keep case records, timelines, correlations, conclusions, and remediation tracking that show analysis occurred and drove action. (NIST CSF 1.1 to 2.0 Core Transition Changes)

DE.AE-02 sits in the Detect function’s “Anomalies and Events” outcomes and is easy to misunderstand: it does not say “respond to incidents.” It says analyze potentially adverse events to better understand the activities associated with them. That means you need an operating rhythm that turns alerts, anomalies, and suspicious observations into documented analysis that improves decision-making: confirm or dismiss, scope what’s affected, identify likely techniques, and feed improvements back into detection, response, and risk management. (NIST CSWP 29)

For a Compliance Officer, CCO, or GRC lead, the fastest path is to (1) define what qualifies as “potentially adverse” in your environment, (2) define who analyzes it and what “done” looks like, and (3) require artifacts that prove the analysis happened and produced actions. If you already run a SOC, SIEM, MDR, or incident response process, DE.AE-02 is the bridge between raw telemetry and accountable outcomes. If you don’t, you can still meet intent with a lightweight event intake and investigation log, provided it is consistent, timely, and produces decisions and follow-up work. (NIST CSF 2.0)

This page gives requirement-level implementation guidance you can put into a control statement, a procedure, and an audit-ready evidence bundle.

Regulatory text

Requirement (excerpt): “Potentially adverse events are analyzed to better understand associated activities.” (NIST CSWP 29)
Reference label: DE.AE-02. (NIST CSF 1.1 to 2.0 Core Transition Changes)

What the operator must do:
You must run a consistent analysis process for events that might indicate harm (malicious activity, policy violations, or abnormal behavior with plausible security impact). The analysis must go beyond acknowledging an alert; it needs to develop understanding of the related activity, such as sequence of actions, affected identities/assets, likely entry points, and whether similar activity exists elsewhere in the environment. The output must drive a decision (dismiss, monitor, escalate to incident) and create follow-up actions (containment, detection tuning, control fixes) with owners and tracking. (NIST CSF 2.0)

Plain-English interpretation (what “good” looks like)

• Input: A suspicious event enters your pipeline (alert, anomaly, third-party notification, user report, EDR finding, cloud control-plane alert).
• Work performed: Someone analyzes it using defined steps (collect context, validate, correlate, scope, hypothesize cause, document).
• Output: A documented conclusion and next step: escalation to incident response, targeted monitoring, or closure with rationale; plus remediation items when analysis reveals gaps.
• Learning loop: Findings feed back into better detection logic and better controls (for example, reduce false positives, add logging, tighten access rules). (NIST CSWP 29)

Who it applies to (entity and operational context)

This requirement applies broadly to:

• Organizations with cybersecurity programs adopting NIST CSF outcomes for governance, customer assurance, or contractual alignment. (NIST CSF 2.0)
• Critical infrastructure operators where abnormal events can have operational and safety implications. (NIST CSF 2.0)
• Service organizations (including SaaS, MSP/MSSP, and other providers) that must show disciplined detection and investigation practices to customers. (NIST CSF 2.0)

Operationally, DE.AE-02 touches:

• SOC / security operations (or your MDR provider)
• Incident response and forensics
• IT operations (identity, endpoint, network, cloud)
• GRC teams who define control expectations and retain evidence
• Third parties that provide detections (MDR) or send security notifications; their alerts still require your analysis and decision trail. (NIST CSWP 29)

What you actually need to do (step-by-step)

1) Define “potentially adverse event” in your environment

Create a short taxonomy that maps to your telemetry and reporting channels. Keep it operational:

• Confirmed malware or suspicious process behavior
• Repeated failed logins or anomalous authentication patterns
• Unusual privilege changes or new admin creation
• Suspicious network connections (beaconing-like behavior, unusual destinations)
• Cloud events (unexpected API calls, policy changes, abnormal data access)
• Third-party security notifications affecting your stack (for example, identity provider advisories relevant to your tenant) (NIST CSWP 29)

Control tip: write an inclusion rule and an exclusion rule. Exclusions should be narrow and documented (for example, known test accounts, sanctioned scanning ranges).

2) Establish a triage-to-analysis workflow with clear decision points

Document a workflow with three states:

1. Triage (is it plausibly adverse? what is urgency?)
2. Analysis (deepen understanding of associated activity)
3. Disposition (close, monitor, or escalate to incident response)

Include an escalation rule: “If indicators suggest unauthorized access, data exposure risk, or lateral movement potential, escalate to incident handling.” Keep it principle-based so it fits your environment; the key is consistent decisioning and documentation. (NIST CSF 2.0)

3) Assign accountable roles (RACI) and ensure coverage

Minimum roles to name:

• Event Analyst (SOC analyst, security engineer, or MDR)
• Incident Commander (for escalations)
• System Owner (for containment and remediation)
• GRC Owner (ensures evidence completeness and metrics)

If you outsource detection, define how your team reviews MDR findings, challenges conclusions, and documents final disposition. DE.AE-02 fails often when “the vendor handled it” is the only story. (NIST CSF 2.0)

4) Standardize the analysis record (your “case file”)

Require a consistent set of fields in your ticketing/case system:

• Event source and timestamp range
• Assets/identities involved and business criticality
• Observed indicators and supporting logs
• Correlation results (related alerts, prior similar events, threat intel notes if you use them)
• Working hypothesis (what activity likely occurred)
• Scope assessment (where else you checked)
• Actions taken (containment steps, config changes, account disablement)
• Disposition and rationale
• Follow-up tasks with owners and due dates (detection tuning, patching, access review, control fixes) (NIST CSWP 29)

This is the fastest way to make the requirement auditable.

5) Build the feedback loop to “better understand associated activities”

Analysis should improve your program. Make it explicit:

• If false positive: document why, tune detection, and record the rule change.
• If true positive but contained: document the control that helped and any gaps.
• If recurring pattern: create a problem ticket for root cause remediation (logging gaps, misconfigurations, weak admin practices). (NIST CSF 2.0)

6) Add measurable indicators and periodic review

You need management visibility that analysis is happening and producing outcomes. Track a small set of indicators that you can explain:

• Volume of potentially adverse events analyzed
• Aging/open cases and backlogs
• Percentage of cases with complete required fields (quality check)
• Themes and systemic fixes created (for example, top recurring sources of suspicious events)

Run periodic reviews and record exceptions, owners, and follow-up actions. Keep the review minutes and the resulting tickets together as your evidence bundle. (NIST CSF 2.0)

7) Make it work with third-party risk and service providers

If third parties operate parts of your environment:

• Require notification SLAs and minimum event context in contracts.
• Ensure you can obtain underlying logs or investigative notes when needed.
• Confirm you retain the right to audit or obtain evidence that supports your analysis and disposition. (NIST CSF 2.0)

Required evidence and artifacts to retain

Auditors and customers usually want proof of operation, not just a policy. Keep:

• Event analysis procedure (triage, analysis steps, disposition rules) mapped to DE.AE-02. (NIST CSWP 29)
• Case files/tickets showing real analysis, not just alert closure comments. (NIST CSF 2.0)
• Investigation checklists/templates used by analysts.
• Correlation outputs (SIEM queries saved, EDR investigation snapshots, timeline notes).
• Post-analysis actions: remediation tickets, detection tuning change records, approvals.
• Periodic review evidence: metrics, review notes, exceptions, and closure of action items. (NIST CSF 2.0)

Evidence hygiene rule: Each case should stand alone. Someone outside security should be able to understand what happened, why you decided what you decided, and what changed afterward.

Common exam/audit questions and hangups

Expect questions like:

• “Show me three examples of potentially adverse events and the analysis performed, including disposition and follow-up.” (NIST CSF 2.0)
• “How do you decide what gets analyzed versus ignored?”
• “How do you ensure consistent analysis quality across analysts or an MDR provider?”
• “How do you know analysis outputs improve detections or controls?”
• “Where is management review documented?” (NIST CSF 2.0)

Common hangups:

• Alert fatigue with shallow closures. “Closed as false positive” with no rationale or scope check reads as noncompliant.
• No linkage to action. Analysis that never produces tuning, remediation, or escalation looks performative. (NIST CSWP 29)

Frequent implementation mistakes (and how to avoid them)

1. Confusing “analysis” with “acknowledgement.”
   Fix: require minimum fields and a short narrative: what you checked, what you found, why you closed or escalated.

2. Only analyzing confirmed incidents.
   Fix: define “potentially adverse” and sample closed alerts in QA to confirm you are analyzing candidates, not just major events. (NIST CSWP 29)

3. No scoping.
   Fix: bake in “where else did we look?” as a required step (other hosts, other accounts, other regions/tenants).

4. Outsourcing without governance.
   Fix: require MDR case notes, periodic joint reviews, and your internal sign-off for disposition on higher-risk systems. (NIST CSF 2.0)

5. No evidence bundle.
   Fix: at the end of each review cycle, export a small packet: metrics, sample cases, exception log, remediation status. (NIST CSF 2.0)

Enforcement context and risk implications

No public enforcement cases were provided in the source catalog for this requirement, so you should treat DE.AE-02 primarily as a defensibility and readiness control: it is how you prove that detection signals turn into understanding and action. Weak event analysis increases the chance that an attacker’s early activity gets misclassified as noise, and it raises your operational risk because teams repeat the same investigations without learning. (NIST CSWP 29)

For regulated organizations and service providers, the risk shows up during exams and customer diligence as “we can’t demonstrate we investigate alerts consistently,” which often expands audit scope into logging, incident response, and third-party oversight. (NIST CSF 2.0)

Practical 30/60/90-day execution plan

First 30 days (stand up the minimum viable control)

• Define “potentially adverse event” criteria and document the triage-to-disposition workflow. (NIST CSWP 29)
• Publish the required case fields and a one-page investigation checklist.
• Pick the system of record (ticketing/case tool) and enforce required fields.
• Start a weekly quality check on a small sample of closed events; log gaps as remediation tasks. (NIST CSF 2.0)

By 60 days (make it consistent and measurable)

• Implement basic metrics and a recurring review meeting with documented outputs (decisions, exceptions, and action items). (NIST CSF 2.0)
• Formalize MDR/third-party handoffs: required context, evidence retention, and internal sign-off rules.
• Add a feedback workflow: detection tuning requests and control remediation tickets must link back to case IDs. (NIST CSF 2.0)

By 90 days (make it audit-ready and resilient)

• Produce a repeatable “evidence bundle” for the quarter: procedure, metrics, sample cases, exception log, and remediation tracking. (NIST CSF 2.0)
• Run a tabletop on an ambiguous alert that tests the analysis workflow (triage, scoping, disposition, comms, evidence).
• Add trend reporting: recurring event themes and what you changed because of them. (NIST CSWP 29)

Where Daydream fits: Daydream is useful when you need a clean, exportable evidence bundle and consistent control operation tracking across review cycles, without relying on tribal knowledge in the SOC or scattered tickets. It also helps GRC teams tie metrics, exceptions, and follow-ups to a single requirement record for DE.AE-02. (NIST CSF 2.0)

Frequently Asked Questions

Do we have to analyze every single security alert?

No. DE.AE-02 expects analysis of “potentially adverse events,” so you need documented criteria that separates benign noise from plausible harm and a record of how you disposition borderline cases. (NIST CSWP 29)

What counts as “analysis” versus “triage”?

Triage is the quick decision on plausibility and urgency. Analysis is the deeper work to understand associated activities, including correlation, scoping, and a documented rationale for closure or escalation. (NIST CSF 2.0)

Can our MDR provider satisfy DE.AE-02 for us?

An MDR can perform much of the analysis, but you still need governance: your criteria, your disposition expectations, and evidence you reviewed and acted on results for your environment. (NIST CSF 2.0)

What evidence do auditors typically accept?

They usually accept case files/tickets with consistent required fields, supporting logs or investigation notes, and linked follow-up actions, plus periodic metrics and management review notes. (NIST CSF 2.0)

How do we show the “better understand associated activities” part?

Show scoping and correlation steps in the case file, and show program changes driven by findings, such as tuned detections, logging improvements, or access control fixes linked back to investigations. (NIST CSWP 29)

We’re small and don’t have a SOC. What is the minimum viable approach?

Use a simple intake channel and a ticket template with required fields, assign an on-call analyst role, and run a recurring review of closed events to verify quality and capture follow-up actions. (NIST CSF 2.0)