Digital literacy plays a significant role in aiding farmers’ shift towards green production methods and enhancing their income. This study utilizes household surveys to gather data from 1,182 Chinese grain farmers to empirically analyze the impact and mechanism of farmers’ digital literacy on the transition toward green food production. The study demonstrates that enhancing farmers’ digital literacy positively impacts the green transition of food production. This effect remains consistent even after endogeneity analysis and robustness testing. The mechanism test shows that farmers’ digital literacy promotes the green transition of food production mainly through the mediating roles of improving farmers’ agricultural skill level, increasing service outsourcing participation, and improving farmers’ green cognition. The extension study reveals that the impact of digital literacy on the green transition of food production is particularly pronounced when farmers possess the traits of risk preference, primarily engage in rice cultivation, and operate on a small scale. Therefore, future efforts should take into account the differences in farmers’ endowments and focus on enhancing digital literacy globally while promoting the integration of digital technologies into agricultural systems worldwide, contributing to the green transformation of food production and supporting the achievement of the global Sustainable Development Goals (SDGs).