Pesantren face the need to preserve the tradition of kitab kuning literacy amid technological developments and changing learning practices. This condition raises the question of how the sorogan method can adapt without losing the epistemological and pedagogical character of the pesantren. This study aims to analyze the transformation of pesantren literacy through the sorogan method in reading kitab kuning at Pondok Pesantren Modern (PPM) Al-Azhar Muncar, Banyuwangi. The study employed a qualitative case study design involving kiai, ustadz, senior santri, and junior santri as research subjects. Data were obtained through participant observation, in-depth interviews, documentation, and field notes, and were analyzed thematically. The findings indicate that sorogan functions as a dynamic literacy practice through individualized reading, direct correction, repetition, textual interpretation, and teacher validation. The transformation also involves increased learner autonomy, annotation practices, digital access to Islamic texts, and the use of digital resources as complementary learning tools. However, digital resources do not replace the pedagogical and epistemic role of the kiai and ustadz. The study contributes to understanding pesantren literacy transformation as an adaptive process that integrates traditional Islamic learning with contemporary literacy practices while maintaining the centrality of teacher-guided knowledge validation.