<p>This study investigates the effect of leadership on the financial performance of Micro and Small Enterprises (MSEs) in Indonesia, while examining the moderating role of digital technology in strengthening leadership capabilities. Derived from a synthesis of eight leadership theories: great man, trait, behavioral, contingency, situational, transactional, transformational, and participative, leadership is conceptualized into three dimensions: innate leadership, learned leadership, and externally influenced leadership. These dimensions comprise six leadership competencies, namely ability to lead and entrepreneurship (innate leadership dimension), knowledge and communication (learned leadership dimension), as well as teamwork and problem-solving (externally influenced leadership dimension). The Technology Acceptance Model is employed to explain digital technology adoption among MSEs and its potential role in enhancing leadership effectiveness. Data were collected from 187 MSE owners in the Riau Islands Province and analyzed using multiple regression and moderated regression techniques. The results indicate that all six leadership competencies significantly enhance MSEs’ financial performance. However, digital technology does not moderate the relationship between leadership competencies and financial performance. These findings underscore the dominant role of leadership in MSEs, which are typically owned and managed by a single individual. Despite the absence of a moderating effect, empirical evidence shows that digital technology adoption particularly for online sales, independently contributes to improved financial performance. This study contributes to leadership theory by proposing a three-dimensional leadership framework and provides practical implications for policymakers, development agencies, and MSE owners in emerging countries.</p>