AbstractThis systematic literature review (SLR) explores the impact of digital technologies on welfare states and bureaucracies, analyzing the evolving dynamics between the state and citizens. The integration of digital technologies reshapes traditional interactions, granting citizens new levels of autonomy and responsibility. Service delivery evolves from conventional bureaucracies to dynamic, data‐driven systems. Employing the PRISMA methodology, the review covers articles from 2017 to 2024, synthesizing insights from 37 selected articles. Key themes, challenges, and opportunities associated with digital transformation in the welfare state are identified. The study offers valuable insights for policymakers, scholars, and practitioners navigating the complex intersection of technology and welfare provision. It underscores the need for a balanced approach to welfare transformation, addressing both the benefits of digitalization and potential challenges such as exclusion, citizen profiling, and other ethical concerns.