Achieving environmental sustainability has become an urgent priority in the era of rapid digital economic expansion, which presents both opportunities and challenges for environmental sustainable development. This study investigates the impact of digital economy (DIE) on environmental sustainability (ENS) through the dual dimensions of digital industrialization (DII) and industrial digitalization (IND), employing the wavelet-based quantile-on-quantile regression method to capture both quantile dependencies and temporal variations. The results reveal that DIE positively impacts ENS in the long term, while its short-term effects are mixed, with positive effects at lower and higher quantiles but negative impacts at mid-range quantiles of [0.35–0.45] and [0.65–0.7]. Specifically, DII exerts a predominantly negative short-term effect on ENS due to the environmental costs of digital infrastructure expansion, but turns positive in the long term as digital industrialization matures, especially in [0.85–0.95]. IND, conversely, exerts a consistently positive impact on ENS in both short- and long-term scenarios, highlighting its role in enhancing industrial efficiency and reducing emissions. These results emphasize the need for targeted policies, including prioritizing industrial digitalization, developing green infrastructure, and adopting phased digital development strategies to maximize environmental benefits.

Purpose: This study aims to examine the dynamic and distributional effects of digital economy (DIE), green innovation (GIN), renewable energy (REE) on sustainable development (SUS) amid accelerating digital and green transformations. Design/methodology/approach: Using a quantile autoregressive distributed lag model, this study conducts a time- and quantile-varying analysis of the relationships among DIE, GIN, REE and SUS across different quantiles and time horizons, focusing on asymmetric dynamics and quantile dependency. Findings: Results reveal that both DIE and REE exhibit significant positive influences on SUS over the long term, while REE serves as a key driver of sustainability in the short term. Asymmetry analysis indicates that the effects of REE and GIN are most pronounced at median levels of SUS, while DIE’s influence intensifies at higher quantiles, reflecting its role in advanced sustainability ecosystems. Strategic prioritization identifies DIE as the dominant long-term enabler, REE as the rapid-response tool and GIN as a latent force of sustainability. Practical implications: The findings provide practical insights for policymakers to tailor sustainability strategies by leveraging digital transformation, accelerating renewable energy deployment and strengthening green innovation systems. Social implications: By shedding light on the differentiated roles of digitalization, green innovation and clean energy in promoting sustainability, this study contributes to the formulation of targeted policies that support sustainable development goals. Originality/value: This paper offers a novel theoretical perspective by integrating DIE, GIN, REE and SUS into a unified framework. It also uniquely integrates the quantile-based approach to uncover the asymmetric and dynamic influences of DIE, GIN and REE on sustainable development, enhancing understanding of the contextual effectiveness of different sustainability drivers.