Micro, Small, and Medium Enterprises (MSMEs) have long been recognized as critical engines of economic growth, job creation, and innovation. This article examines multifaceted aspects of the MSMEs' function in facilitating entrepreneurship in era of extensive digitization. We believe that MSMEs are not only playing an active part in economy and are becoming important catalysts and incubators for new generation of digital entrepreneurs. They do this through being agile adopters of emerging technologies, developing niche markets, innovative cultures, providing laboratory for dynamic digital training. This paper presents on literature to discuss ways in which digitally-enabled MSMEs reduce entry barriers, promote platform-based business models, produce ‘intrapreneurship’. It also discusses significant barriers that hinder this potential, such as digital literacy gap, lack of resources, cybersecurity threats. The article states that symbiotic relationship between MSMEs and digital technology is essential for creating a resilient and dynamic entrepreneurial ecosystem and recommends policy implications for better digital literacy and infrastructure to unlock its potential.