To determine the domain functional level, Windows Server 2003 uses a combination of two attributes stored in Active Directory. To determine the forest functional level, Windows Server 2003 uses a single attribute.
To verify the forest and domain functional level by using ADSIEdit.msc:

  1. Open a Run command, and type ADSIEdit.msc
  2. Expand the Domain object, right-click domainname (where domainname is the distinguished name of the domain that you want to check), and then click Properties.
  3. Under the Attribute column, scroll until you locate the msDS-Behavior-Version attribute. Check the value of this attribute.
  4. Check the value of the nTMixedDomain attribute on the domain object. The following table provides the details for both attributes for the domain functional level.
Domain functional level msDS-Behavior-Version attribute nTMixedDomainattribute
Windows 2000 mixed 0 1
Windows 2000 native 0 0
Windows Server 2003 2 0

To verify the forest functional level, expand the Configuration object, and  then expand the CN=Configuration,forestname object (where forestname is the  distinguished name of the forest).

Right-click the Partitions container, and then click Properties. Locate the  msDS-Behavior-Version attribute, and check the value of this attribute. The  following table provides the details for the attribute for the forest  functional level.

Forest functional level msDS-Behavior-Version attribute
Windows 2000 0
Windows 2000 interim 1
Windows Server 2003 2

Source: Microsoft Corporation