This paper presents a case study on applying digital tools for the sustainable renovation of a cultural heritage building, the Mikas and Kipras Petrauskas House in Kaunas, Lithuania. The study integrates Heritage Building Information Modeling (HBIM), indoor environmental quality (IEQ) monitoring, and life cycle assessment (LCA) to evaluate renovation solutions in alignment with smart and sustainable city goals. A high-accuracy HBIM model was developed using photogrammetry and laser scanning, achieving less than 2% deviation from validated geometric dimensions. The model provided a reliable foundation for analytical workflows and demonstrated how digital capture can reduce time and mitigate reliance on outdated documentation. Indoor climate measurements indicated critical humidity conditions during the cold season, highlighting the need for improved environmental controls to preserve both occupant comfort and material preservation. LCA was employed to assess the embodied carbon of renovation materials, and alternative selections led to a 22% reduction in CO2e emissions. The results confirm that integrating HBIM, IAQ analysis, and LCA provides a robust methodology for data-driven decision-making in heritage renovation. The approach also supports the future development of digital twin frameworks that balance environmental sustainability with cultural value.