<p>Digital transformation (DT) is one of the most critical development strategies in the age of the digital economy. However, prior research on DT has mainly centered on the macro level, with limited attention given to the factors related to employees. Consequently, the impact of DT on employee work withdrawal behavior presents a research topic worthy of in-depth exploration. Drawing on transactional stress theory and technology acceptance model (TAM), this paper constructs a dual-path framework to investigate the double-edged sword nature of DT on work withdrawal behavior. By analyzing data of a three-wave research design from 343 employees in China, the mediating effects of different appraisals (i.e. threat and challenge appraisals) were confirmed. Additionally, the moderating role of technological characteristics, namely perceived usefulness (PU) and perceived ease of use (PEOU), was also verified in the stressor appraisal process. The findings of this research not only enrich the theoretical research on DT based on the organizational context, but also provide managerial insights for businesses to harness the advantages of DT while minimizing its possible adverse effects.</p>