Abstract: In the process of promoting Chinese path to modernization, the development of digital economy is of great significance for achieving the goal of common prosperity. The panel data of 254 cities at prefecture level and above in China from 2011 to 2021 were selected as samples to construct an indicator system based on their connotation characteristics. The benchmark regression model and intermediary effect model were used to test the impact of digital economy on common prosperity and its mechanism, and the threshold effect model was further used to test the nonlinear relationship between digital economy and common prosperity. The results indicate that the digital economy has a promoting effect on common prosperity, and this effect is particularly significant in the eastern region, large-scale cities, and non resource-based cities; Entrepreneurial activity, human capital, and technological innovation are effective mechanisms for promoting common prosperity in the digital economy; The digital economy empowers common prosperity with a non-linear feature of increasing marginal effects. Therefore, based on the research findings, policy recommendations are proposed: to continuously improve digital infrastructure and promote digital transformation; Develop regional development strategies and tap into digital potential; Actively play the role of the government and help promote common prosperity.