I see previous incidents assigned to groups, but starting this morning, there are no groups in the dropdown menu for assignee.
A Quick fix is to go to Setup - Global Settings - Service Desk Settings and disabled the "Assigned to field displays only users and queue members" option.Our engineering team is working on a fix to be deployed in production that will revert the account back to the previous selected option (on or off).
This fixed it. The toggle was actually set correctly for us, I just had to toggle it off and back on and then the groups repopulated within the dropdown list.