Abstract: The digital economy, which has developed rapidly in recent years, has become a "new engine" for China's economy to move towards high-quality development. Based on the data of 272 prefecture-level cities in China, this paper deeply analyzes the impact of entrepreneurship activity on the development of digital economy and its subdivision characteristics such as heterogeneity, nonlinearity, spatial spillover, and moderating effect. The results show that: The improvement of entrepreneurship activity can significantly promote the development of digital economy, and this result is still valid after a series of robustness tests. Further analysis reveals that this promoting effect is a nonlinear diminishing marginal impact, more pronounced in inland regions and non-agricultural sector and positive spatial spillover. Intellectual property protection and fiscal decentralization play a positive moderating effect. With higher levels of intellectual property protection and fiscal decentralization, the enhancing effect of entrepreneurship activity on the digital economy development is more pronounced. This paper enriches the research on the relationship between entrepreneurship activity and the development of digital economy and provides policy reference for better promoting the development of regional digital economy.