<p>Rapid economic growth and increasing energy demand have intensified environmental issues, especially carbon dioxide emissions, in energy-dependent economies. This paper investigates how energy consumption and technological innovation influence carbon dioxide emissions in Saudi Arabia from 1988 to 2023, while accounting for key macroeconomic variables, including economic growth, domestic and foreign investment, financial development, and urbanization. The study employs the Autoregressive Distributed Lag (ARDL) model to analyze short- and long-term relationships. Results show that energy consumption significantly contributes to carbon dioxide emissions in both the short and long runs, highlighting the need to adopt renewable energy and enhance energy efficiency. Conversely, technological innovation, measured by patents filed by country residents, reduces carbon dioxide emissions in the short-run and long-run, with significant long-term effects, illustrating how innovation-driven efficiency can mitigate environmental pollution in the long run. The analysis also indicates that economic growth initially accelerates emissions but slows over time. Domestic investment and urbanization are associated with reduced emissions, reflecting advancements in infrastructure and investment quality. Meanwhile, foreign investment appears to increase pollution, implying a need for sustainable investment flows. Overall, the findings underscore the importance of sustainable growth and decarbonization in Saudi Arabia, necessitating policies for the energy transition, innovation-led efficiency improvements, higher investment quality, and sustainable urban development.</p>