Amid the ongoing implementation of China’s national digital education strategy, the digital transformation of higher education institutions has progressed rapidly, yet continues to face numerous limitations. Based on a systematic review of literature and case studies, this paper demonstrates that the breakthrough development of large language models offer novel pathways to address these issues. The study is organized as follows: (1) analysis of core digitalization challenges and the enabling value of LLMs, emphasizing semantic comprehension and integration capabilities; (2) synthesis of LLM applications in key scenarios such as intelligent Q&A and process automation; (3) examination of critical implementation barriers, including technological hallucination and data privacy risks, which suggests that the need for a dual strategy combining innovation and governance; and (4) strategic recommendations proposed across four dimensions: strategy, governance, talent development, and ecosystem construction. This study aims to provide theoretical insights and practical guidance for advancing the digital transformation and upgrading of higher education.