Digital literacy has become an increasingly important skill for youth entrepreneurs in Nairobi's Lower East Side, a district characterized by rapid urbanization and economic growth. A mixed-methods approach was employed, including structured questionnaires for quantitative data collection and semi-structured interviews as part of thematic analysis for qualitative insights. Data were collected from a sample of 150 youth entrepreneurs between the ages of 18 and 30 who own or run their businesses. The survey revealed that while 92% of respondents had access to smartphones, only 45% utilised them daily for work purposes. Furthermore, over 60% reported difficulties in using digital payment systems effectively. This study highlights the significant disparity between the availability of digital technologies and their actual utilization by youth entrepreneurs in Nairobi's Lower East Side. The findings suggest that targeted training programmes are needed to bridge these gaps. Developing tailored digital literacy programmes specifically for young entrepreneurs is recommended, focusing on enhancing skills related to internet usage frequency, software application proficiency, and the adoption of online payment systems.