ESG is the key fulcrum for China to realize the “carbon peaking” and “carbon neutrality” goals and sustainable development, and it is also an important indicator of the high-quality development of enterprises. Under the wave of the digital economy, it is urgent to study how enterprises can eff ectively utilize the resources, capabilities, and competitive advantages of digital transformation to improve ESG performance. This paper uses panel data of Chinese A-share listed companies from 2013-2021 to examine the impact of digital transformation on corporate ESG performance. It is found that the degree of digital transformation has a signifi cant “inverted U-shape” relationship with corporate ESG performance, which remains robust after a series of tests such as extended time observation period, instrumental variable method, PSM-DID, etc.; Heterogeneity analysis shows that state-owned enterprises, non-heavily polluted enterprises，and enterprises with a higher proportion of women in management, internationalization, and R&D investment can achieve the best ESG performance at a higher level of digital transformation; The mechanism analysis shows that digital transformation aff ects fi rms’ ESG performance mainly through two channels: fi rms’ green technology innovation, and disclosure quality. This paper enriches the research on the infl uencing factors and enhancement mechanisms of ESG performance, and proposes that companies should carry out diff erentiated and moderate digital transformation to achieve optimal ESG performance.