<p>The transition towards decarbonization, aimed at reducing carbon emissions and mitigating climate change, has profound implications for economic development. Therefore, this study explores the impact of decarbonization efforts on economic growth, focusing on how the shift to sustainable energy sources and low-carbon technologies influences key economic indicators. Moreover, this study also explores the variation in the aforementioned nexus based on the developmental status of countries. This study is empirical in nature, as we used a cross-country panel dataset of both developed and developing countries. Moreover, we have chosen appropriate empirical analysis, and the results are in line with the previous literature and support the hypothesis of the study. This research underscores the necessity of strategic policy frameworks that balance immediate environmental targets with broader economic stability, providing evidence-based insights for achieving global sustainability goals.</p>