This study explores the impact of digital technology adoption on the carbon footprint of SMEs. Utilizing a framework aligned with the ISO Standard 14040 for Life Cycle Assessment, the research evaluates how different levels of digital maturity of the Portuguese Ornamental Stone SMEs influence KPIs related to energy efficiency, production quality, material utilization, and carbon emissions. Companies are categorized by their Digital Rank, ranging from DR#0 (no digitalization) to DR#4 (advanced digital integration). The findings indicate that higher levels of digital maturity are associated with significant environmental and operational benefits. For instance, companies at the DR#4 level achieve a 35.1% reduction in carbon emissions per unit of output compared to those at DR#0. Additionally, these companies show substantial improvements in energy efficiency, producing more units per kWh and enhanced raw material yield, minimizing waste and optimizing resource use. The results underscore the transformative potential of digital technologies in promoting sustainability and operational efficiency. Companies that integrate advanced digital tools not only reduce their environmental impact but also improve their competitiveness and productivity. This research highlights the necessity of a comprehensive approach to digital transformation, encompassing technological investments, organizational change, and process optimization. The study provides actionable insights for policymakers, industry leaders, and SMEs on leveraging digital technologies to achieve sustainability goals. It emphasizes the critical role of digitalization in supporting the global transition to a low-carbon economy. It suggests avenues for future research to explore further integrated digital strategies and their long-term impacts on sustainability.