Hello,
This is actually an issue on Microsoft's side, it is mentioned in the Admin Center > Service Health section. I will paste the latest information here:
Some users may be unable to move channels into folders, such as favorites, or sections within Microsoft Teams
Issue ID: TM1275443
Affected services: Microsoft Teams
Status: Service degradation
Issue type: Advisory
Start time: Mar 26, 2026, 2:00 PM CDT
User impact
Users may be unable to move channels into folders, such as favorites, or sections within Microsoft Teams.
More info
Affected users may see channels become hidden when attempting to move them into folders or sections.
To unhide affected channels, users can navigate to Teams, See all channels. Find the hidden channel and select 'Show'. If another attempt is made to move the channel into a folder or section, it may become hidden again.
Scope of impact
Some users attempting to move channels into folders or sections within Microsoft Teams may be impacted. This section may be updated as our investigation progresses.
Root cause
A recent code change introduced a race condition that occurs when users attempt to move channels into folders or sections, resulting in impact.
Current status
Apr 13, 2026, 5:10 PM CDT
We’ve confirmed that the majority of impacted users have already received the fix, while the remaining impacted users will experience remediation by our next scheduled update.
Next update by:
Tuesday, April 14, 2026 at 4:00 PM CDT