Indonesian small and medium-sized enterprises (SMEs) are adopting environmentally friendly manufacturing processes to ensure long-term sustainability. This involves enhancing efficiency, utilizing renewable energy sources, and carefully evaluating product alternatives and waste management strategies. The use of online platforms and digital marketing has expanded SMEs' international prospects, gaining global attention and a competitive advantage. Incorporating green business practices into operations can result in financial savings and a distinct advantage within the marketIn Indonesia's micro, small, and medium-sized enterprises (SMEs), digital literacy is playing an important role, notably in green innovation. Operations may be optimized, inefficiencies can be reduced, and environmental effect can be mitigated with the help of digital tools and platforms. This research makes use of a quantitative methodology by conducting a survey in order to collect information from individuals who are involved in the SME industry in Central Java. The research made use of Structural Equation Modeling (SEM) and Partial Least Squares (PLS) to analyze the validity and dependability of the data that had been collected. The results suggest that green business strategies improve SME performance. The influence of HR on SME performance is not statistically significant. SME performance is statistically linked to digital literacy. This relationship was affected by digital literacy. Environmental innovation has no statistically significant impact on SME productivity. Environmentally friendly innovation has a statistically minimal influence.