<![CDATA[The development of the digital economy in Indonesia has had a significant impact on the transformation and growth of Micro, Small, and Medium Enterprises (MSMEs). This study aims to analyze the influence of digitalization—including the use of e-commerce platforms, digital payments, and social media-based marketing—on improving MSME performance. The method used is a literature review of various recent studies and reports on the digital economy and MSMEs. The analysis results show that the digital economy contributes positively to increased revenue, market expansion, and operational efficiency of MSMEs. However, challenges such as low digital literacy, limited internet infrastructure, and high digital competition remain major obstacles. This study emphasizes the importance of increasing MSME digital capacity and government support to strengthen competitiveness in the digital economy era. In addition, the adoption of digital technology also encourages product innovation and MSME business models to be more adaptive to changes in consumer behavior. Collaboration between the government, the private sector, and educational institutions is considered crucial in accelerating the digital transformation of MSMEs. With appropriate and sustainable digital strategies, MSMEs are expected to increase their contribution to national economic growth and job creation.]]>
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