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Most commonly cause of the error is having the wrong mail server option selected in the panel. The primary choices are remote and local.

This error is often seen when both the sender and recipient domains exist on the same server, but the recipient server has the wrong mail server selected. You can confirm that this is indeed the problem by confirming that the MX record points to a remote mail server, but the panel has the domain stored in its ‘local domains’ file.

The server is configured optimally so it will save itself from querying the MX record of a domain if it can. It does this by sending mail locally for any domain listed in its local domains file. If the domain is listed there, it sends the mail locally even if the MX records would route otherwise externally.

The Fix

To fix you just need to edit the appropriate files so that the server knows that is must query the MX record and use the results to route the emails externally.

Via SSH

Remove the domain from the /etc/virtual/domains file.

cat /etc/virtual/domains

test.com
demo.com
test123.com

Via Direct admin control panel

Log in Direct admin as admin. Show all Users Log in as user Go to User Panel → domain.com → MX Records Uncheck the “Local Mail Server” option.

** Important**

Make sure that you do not use the mail subdomain as the MX record for remote domains on DirectAdmin servers. The server routes this MX subdomain locally regardless of whether it points to a remote location. You must remove the mail subdomain as the MX record and use a different MX record.