<p>This study aims to identify the factors influencing textile and garment SMEs’ intentions to adopt digital technology. A survey of owners of textile and garment SMEs respondents was conducted to explore the determinants that shape SMEs’ decisions to adopt digital technology using the Unified Theory of Acceptance and Use of Technology (UTAUT), which was extended with six additional variables: trust and perceived risk for internal of SMEs, competitive pressure and government support for external of SMEs, and non-financial and financial performance for the impact of digital technology on SMEs business. The findings indicate a significant influence of performance expectancy, effort expectancy, trust, government support, and competitive pressure on digital technology adoption by textile and garment SMEs. Then, facilitating condition and behavioural intention significantly influence actual behavior to use, impacting both financial and non-financial performance. The study’s findings provide vital insights for owners of SMEs and government (policymakers) for the successful adoption of digital technology. The integration of digital technologies requires specialized skills. Governments and industry associations can implement training programs to equip workers with the necessary skills for operating digital machinery and managing digital systems.</p>