What attackers do. Attackers hide command and control traffic inside DNS queries and responses, since DNS is needed almost everywhere and is often lightly monitored. This sub-technique serves the Command and Control tactic.
How to defend. Force all endpoints to use internal DNS resolvers and block direct DNS to the internet. Log DNS queries centrally, use protective DNS services with threat intelligence, and consider blocking newly registered domains. Watch for DNS over HTTPS to unapproved resolvers, which bypasses these controls.
Signs to look for. Look for long or random-looking subdomains, high query volumes to a single domain, unusual record types such as TXT used heavily, and hosts querying external resolvers directly. A common gap is not retaining DNS logs at all.