As emerging technologies such as big data, cloud computing, and artificial intelligence become pervasive in the financial sector, the academic community has extensively investigated the impact of digital finance on firm behavior at the micro level. This study draws on data from listed firms on the Shanghai and Shenzhen A-share markets between 2011 and 2018 to empirically assess how digital finance influences corporate earnings management and to explore the mechanisms underlying this relationship. The results demonstrate that digital finance significantly curtails earnings management, thereby evidencing a strong governance effect. Further examination reveals that this governance impact is more pronounced in regions with stringent financial regulations and among companies possessing robust internal controls. An in-depth analysis of the developmental stages, structural aspects, and regional dispersion of digital finance shows that the governance implications of its “utilization depth” become more marked during periods of dynamic development, also displaying notable regional disparities. Tests of underlying mechanisms indicate that digital finance primarily affects earnings management by enhancing information supervision and reducing financing constraints. The analysis of economic outcomes suggests that the governance effects of rapid digital finance development substantially improve corporate performance and value. This study not only broadens the understanding of corporate governance in the era of big data but also advances research on the interplay between digital finance and earnings management. These insights offer valuable references for optimizing corporate governance structures and refining financial regulatory frameworks amid economic transformation.