Small and Medium-Sized Enterprises (SMEs), as the cornerstones of economic growth, are expected to embrace cutting-edge technologies to maintain competitiveness. Faced with the twin pressure of integrating technological innovations and meeting escalating environmental and social expectations, SMEs must navigate these intertwined challenges strategically. This intricate balance, central to the ‘twin transition’—the simultaneous advancement toward digitalization and sustainability—compels SMEs to strategically navigate the interwoven challenges of embracing technological innovations while also adhering to rising environmental and social expectations. In this paper, the focus is on identifying critical success factors (CSFs) in the twin transition process. A two-step methodology is employed in the paper, beginning with a comprehensive literature review to identify CSFs for twin transition, followed by the use of a questionnaire for their empirical validation. The literature review resulted in the identification of 31 CSFs, of which 17 are empirically validated through data collected from 29 respondents via the questionnaire. Valuable insights are presented by the study for SMEs embarking on their twin transition journey, and the groundwork is laid for both policy development and academic inquiry. Despite its contributions, the study has limitations, including the scope of the literature review, which is restricted to the period from 2018 to 2023, and the survey’s exclusive distribution to practitioners within the UK’s manufacturing sector, specifically those engaged in digitalization and sustainability.