This is a systematic review of the literature on how digital technologies shape and influence the internationalization of SMEs through capability development and barrier mitigation. Following the Preferred Reporting Items for Systematic Reviews and Meta-Analyses (PRISMA) 2020 guidelines, a search was conducted on 13 July 2025, in the Scopus and Web of Science databases. The inclusion criteria prioritized peer-reviewed journal articles published between 2020 and 2025. The rigorous selection process resulted in a final sample of 61 studies from an initial group of 1120 records. A descriptive bibliometric analysis and qualitative thematic synthesis were used to classify the evidence according to technologies, internationalization functions, barriers, and contextual characteristics. The results show that the literature primarily focuses on digital transformation and innovation (27.9%), managerial and strategic capabilities (26.2%), and the institutional environment (21.3%). The findings further show that digital technologies play distinct roles: while e-commerce and cross-cutting information and communication technology (ICT) capabilities primarily facilitate market access and adaptation, more advanced technologies such as blockchain, Industry 4.0, and the IoT are directly linked to coordination and international performance. The review also shows that the digital internationalization of SMEs is constrained by multilevel barriers that operate simultaneously, with organizational and strategic limitations, regulatory compliance requirements, and financing costs being the most prominent. In conclusion, the value of digitalization lies in its organizational integration rather than in the mere adoption of technology. Future research with longitudinal designs is needed to examine how these digital resources are transformed into effective capabilities under different internal and environmental conditions.