The expanded partnership includes a new 10-year search agreement.
AOL will be responsible for all of Microsoft's display, mobile and video advertising inventory in nine markets including the U.S., the U.K., Canada, Brazil and France. AOL was recently purchased by Verizon, in a $4.4 billion deal that Verizon announced last week.
AOL will transition to a Bing-powered search solution beginning next year, replacing Google. Bing is Microsoft's web search engine, unveiled in 2009.
"This deal is further evidence of the quality of Bing results and the performance of the Bing Ads marketplace," said Rik van der Kooi, corporate vice president at Microsoft in the press release. "And we will continue our focus on delivering world-class consumer services and content and look forward to partnering with AOL to market them."
Also on Monday, Microsoft confirmed that it will stop collecting its own map data, according to reporting by Recode.com. The company did say it will continue to offer Bing Maps.
Microsoft will also sell some of its technology to the ride-sharing company and 100 workers will transition to Uber, the site reports. No finances regarding the deal were disclosed.
"Over the past year, we have taken many actions to focus the company's efforts around our core business strategy," Microsoft said in a statement to Re/code. "In keeping with these efforts, we will no longer collect mapping imagery ourselves, and instead will continue to partner with premium content and imagery providers for underlying data while concentrating our resources on the core user experience. With this decision, we will transfer many of our imagery acquisition operations to Uber."