Some users are unable to sign in after adding a new Microsoft account in Windows 11, this is after installing update KB5016691 on date 25.08.22.
It only affects users who created a new user account and try to log on to it. You may not be able to log in or log out for a short while after the first reboot.
Note, Microsoft: If you encounter this issue, it will automatically resolve itself after a brief time. You will need to wait for the lock screen to appear again, you should be able to log in as expected.
Resolution: This issue is resolved using Known Issue Rollback (KIR). Please note that it might take up to 24 hours for the resolution to propagate automatically to consumer devices and non-managed business devices. Restarting your Windows device might help the resolution apply to your device faster. For enterprise-managed devices that have installed an affected update and encountered this issue can resolve it by installing and configuring a special Group Policy. The special Group Policy can be found in Computer Configuration -> Administrative Templates -> KB5016691 220722_051525 Known Issue Rollback -> Windows 11 (original release).
For information on deploying and configuring these special Group Policy, please see How to use Group Policy to deploy a Known Issue Rollback.
Read More: Workaround