Contact tracing technology has been adopted in many countries to aid in identifying, evaluating, and handling individuals who have had contact with those infected with COVID-19. Singapore was among the countries that actively implemented the government-led contact tracing program known as TraceTogether. Despite the benefits the contact tracing program could provide to individuals and the community, privacy issues were a significant barrier to individuals' acceptance of the program. Building on the privacy calculus model, this study investigates how the perceptions of the 2 key groups (ie, government and community members) involved in the digital contact tracing factor into individuals' privacy calculus of digital contact tracing. Using a mixed method approach, we conducted (1) a 2-wave survey (n=674) and (2) in-depth interviews (n=12) with TraceTogether users in Singapore. Using structural equation modeling, this study investigated how trust in the government and the sense of community exhibited by individuals during the early stage of implementation (time 1) predicted privacy concerns, perceived benefits, and future use intentions, measured after the program was fully implemented (time 2). Expanding on the survey results, this study conducted one-on-one interviews to gain in-depth insights into the privacy considerations involved in digital contact tracing. The results from the survey showed that trust in the government increased perceived benefits while decreasing privacy concerns regarding the use of TraceTogether. Furthermore, individuals who felt a connection to community members by participating in the program (ie, the sense of community) were more inclined to believe in its benefits. The sense of community also played a moderating role in the influence of government trust on perceived benefits. Follow-up in-depth interviews highlighted that having a sense of control over information and transparency in the government's data management were crucial factors in privacy considerations. The interviews also highlighted surveillance as the most prevalent aspect of privacy concerns regarding TraceTogether use. In addition, our findings revealed that trust in the government, particularly the perceived transparency of government actions, was most strongly associated with concerns regarding the secondary use of data. Using a mixed method approach involving a 2-wave survey and in-depth interview data, we expanded our understanding of privacy decisions and the privacy calculus in the context of digital contact tracing. The opposite influences of privacy concerns and perceived benefit on use intention suggest that the privacy calculus in TraceTogether might be viewed as a rational process of weighing between privacy risks and use benefits to make an uptake decision. However, our study demonstrated that existing perceptions toward the provider and the government in the contact tracing context, as well as the perception of the community triggered by TraceTogether use, may bias user appraisals of privacy risks and the benefits of contact tracing.