The rapid diffusion of digital technologies including social media marketing, e-commerce platforms, mobile payment systems, cloud-based accounting, and customer relationship management (CRM) tools has fundamentally reshaped the operating environment of small businesses worldwide. This study statistically examines the relationship between the extent of digital technology adoption and small business performance, measured through sales growth, customer reach, operational efficiency, and profitability. A structured survey was administered to a sample of small business owners/managers (N = 250) across retail, services, and manufacturing sectors. Data were analyzed using IBM SPSS Statistics through descriptive statistics, reliability analysis (Cronbach's Alpha), Pearson correlation, independent samples t-tests, one-way ANOVA, and multiple linear regression. Results indicate a statistically significant and positive relationship between digital technology adoption and overall business performance (r = 0.612, p < 0.01). Regression analysis reveals that digital marketing adoption (β = 0.34, p < 0.001) and digital payment/financial tools (β = 0.28, p < 0.001) are the strongest predictors of performance, jointly explaining 46.8% of the variance (R² = 0.468, Adjusted R² = 0.459, F(4,245) = 53.87, p < 0.001). Businesses with high digital adoption reported significantly higher performance scores than low-adoption businesses (t(248) = 7.42, p < 0.001). The findings underscore the strategic necessity of digital technology integration for small business competitiveness and sustainability, while also highlighting persistent barriers related to cost, digital literacy, and infrastructure. The study concludes with policy and managerial recommendations to accelerate inclusive digital adoption among small enterprises.