Against the backdrop of the comprehensive advancement of the rural revitalization strategy, the digital economy has become a key force in promoting modernization of agriculture and rural areas and driving holistic rural revitalization. Whether the digital economy can effectively empower rural revitalization, through what mechanisms it operates, and whether its impacts exhibit distinct characteristics have become critical questions requiring urgent answers for achieving rural revitalization. Therefore, this paper systematically examines the internal logic and operational mechanisms of the digital economy’s impact on rural revitalization from both theoretical and empirical perspectives. Theoretical analysis shows that the digital economy can significantly enhance rural revitalization, with its positive effects further amplified by improved factor allocation efficiency and strengthened government governance. Building on this theoretical foundation, we conduct an empirical test using balanced panel data from 259 prefecture-level cities in China spanning 2010—2024. Results indicate: first, the digital economy has indeed promoted rural revitalization, and this conclusion remains robust across various sensitivity tests. Second, mechanism tests reveal that the digital economy contributes to rural revitalization by effectively correcting resource misallocation; meanwhile, the synergistic development between effective government governance and the digital economy ensures more sustainable and stable progress in rural revitalization. Third, heterogeneity tests show that the impact of the digital economy on rural revitalization exhibits typical non-equilibrium heterogeneity, particularly evident in differences across time periods, levels of factor allocation, and between northern and southern regions. Accurately understanding the development patterns of the digital economy and fully leveraging its role in optimizing rural resource allocation and enhancing governance effectiveness can help promote holistic rural revitalization.