Does Entra ID deployment require on-premises Active Directory?

No. Organizations operating fully cloud-native on Microsoft 365 with no on-premises AD are in scope for Phases 1, 2, 3, 5, and 6. Hybrid identity integration (Phase 4) applies only where on-premises AD exists and needs to be synchronized with Entra ID. The scoping call at the start of the engagement confirms which phases apply to your environment.