This study investigates the impact of foreign direct investment (FDI) on energy intensity in Latin American countries. Using a balanced panel data model covering 13 countries in the region during the period 2000–2017, it analyzes how FDI influences the amount of energy consumed per unit of gross domestic product (GDP) at constant 2018 prices. The results show that FDI can reduce energy intensity through the transfer of efficient technologies and the promotion of sustainable management practices. However, the effect varies significantly between countries, depending on factors such as innovation capacity and economic performance. Countries with greater innovation capacities and better economic performance tend to absorb the benefits of FDI in terms of energy efficiency more effectively. These findings underscore the importance of designing policies that promote sustainable innovation and improve the economic environment to maximize the benefits of FDI in the region.