Research Originality: This study develops an integrated framework explaining Islamic work ethic through entrepreneurial orientation, digital capability, knowledge sharing, and work engagement, while positioning environmental dynamism as a contextual moderator in Indonesian fashion SMEs. Research Objectives: This study examines the effects of entrepreneurial orientation, digital capability, knowledge sharing, and environmental dynamism on Islamic work ethic, the mediating role of work engagement, and the moderating role of environmental dynamism. Research Method: A quantitative survey was conducted among 300 fashion SME owners and managers in Indonesia. Data were analyzed using Partial Least Squares Structural Equation Modeling. Empirical Results: The findings show that all direct relationships are positive and significant. Work engagement significantly mediates the effects of entrepreneurial orientation, digital capability, and knowledge sharing on Islamic work ethic. Environmental dynamism strengthens the effects of digital capability, entrepreneurial orientation, and work engagement, but does not significantly moderate knowledge sharing. Implications: The findings highlight the importance of integrating organizational capabilities, knowledge sharing, employee engagement, and Islamic ethical values to support sustainable SME development. JEL Classification: L26, M14, O33
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