Digital transformation has proved to be an efficient driver of entrepreneurship in emerging markets; however, the dynamics between the two phenomena have not been thoroughly investigated yet. To bridge this gap, we systematize the results of literature reviews and empirical research conducted in various emerging economies to understand how digital transformation influences entrepreneurial ecosystems, firm capabilities, and economic performance. Specifically, digital transformation helps overcome informational gaps, creates favorable conditions for market entry, and allows firms to adopt innovation in their business models. Notably, mobile banking technology alone stimulates entrepreneurial activity among 8-13% of families in some developing countries. Nevertheless, the dynamic nature of the process is evident in the fact that although 5.4 million new users of digital services have been connected in West Africa, only 7% of MSMEs in India consider implementing artificial intelligence solutions. Based on our analysis, digital infrastructure, institutional structures, and knowledge application capabilities act as critical moderating factors in terms of turning digital transformation into entrepreneurship.