If you don’t already have a domain and don’t want to purchase it at the same time as Office 365, you’ll be given an OnMicrosoft domain by default as part of the set up process. This is created at the same time your tenancy is built.
You can either choose a name, or use the same name as your tenancy (if available). Your domain address would take the format: ‘@exampleltd.onmicrosoft.com’
Once you have a domain, follow the setup process for I already have a domain