Is there a way to set up a rule so that all emails from a specific server (example microsoft.com) go into a specific folder? I can do it individually each time someone from work emails me but want to set it up so that people from microsoft.com who have never emailed me would automatically go into my MS folder?
Yes. You need to enter just the email domain and cancel the Check Names dialog when it appears. The finished rule will look like the image on the right in Rules Wizard.
While this rule trick works in Microsoft Outlook 2010 and 2013, it's not necessary as Outlook 2010 includes a rule for "specific words in the senders address" which you can use instead. A similar rule exists for 'words in the recipients address'.
If you want to apply a rule to all mail originating outside of Exchange, use @ in place of the domain name. To apply a rule only to internal email, create a rule that applies to all mail and add an exception for messages with @ in the sender's address. Internal Exchange email does not use a SMTP address and therefore, does not contain an @ sign. For internal Exchange server mail, use /ou.
Outlook 2010, 2013 "words in the address" method
If you are using Outlook 2010 or 2013, you can create a rule "with specific words in the sender's address", highlighted in the red box in the screenshot.
Select the condition, click on the underlined words in the lower part of the dialog box then type the domain name you want the rule to apply to.
Note: The two items marked with arrows provide alternate ways to do this and are also available in older versions of Outlook.
Outlook 2003 and up "from people or group" method
Step 1: Begin creating the rule, using the condition "from people or public group".
Click in the underlined people or public group at the bottom of the dialog box to open the Rule Address dialog.
Type the domain portion of the address in the Address field at the bottom of the dialog.
To apply this rule to all email from Internet addresses, enter just an @ sign in the From field. Mail originating on your Exchange server will be skipped.
Step 2: Click Ok after entering the domain in the address field, then Cancel the Check Names dialog when it appears.
Outlook 2002 and older
The address book dialog in Outlook 2002, 2000, or 98 looks like the following screenshot. Type the domain in the right pane. (Note: The address dialog in Outlook 98/2000 in Internet mode doesn't support entering partial addresses.)