The Irish Council for Civil Liberties (ICCL) has filed a complaint against Microsoft Ireland to the Data Protection Commission (DPC).
The ICCL is accusing Microsoft of unlawful data processing on behalf of the Israeli Defence Forces (IDF) in Gaza.
In its complaint, the ICCL has asked the DPC to urgently investigate Microsoft Ireland's processing, which it said has enabled the killing of civilians and continues to enable human rights violations.
The council has also asked the DPC to exercise its powers to stop the processing.
The ICCL said it is representing a group of data subjects in the complaint, including Palestinian residents of Gaza and the West Bank.
The complaint includes materials from within Microsoft that the council said was provided by whistleblowers.
"These are not abstract data protection failures, they are violations that have enabled real-world violence," said Joe O'Brien, Executive Director of ICCL.
"When EU infrastructure is used to enable surveillance and targeting, the Irish Data Protection Commission must step in and it must use its full powers to hold Microsoft to account," he added.
Microsoft said its customers own their data and the actions taken by this customer to transfer their data in August was their choice.
"These actions in no way impeded our investigation," a spokesperson said.
"That investigation led to a decision to cease some services in September, and ultimately to the customer storing their data with another provider," a Microsoft spokesperson said.