Digital transformation is reshaping India’s transportation and logistics sector by facilitating data-driven coordination, enhanced visibility, and sustainable supply chain operations. This study analytically examines the impact of digital technologies such as IoT, automation, artificial intelligence, and blockchain on dexterity, explicability, and sustainability in the modernization of India’s logistics ecosystem. Drawing on secondary data, policy frameworks including Gati Shakti, the National Logistics Policy (NLP), and the Unified Logistics Interface Platform (ULIP), along with recent empirical evidences, the study evaluates how digital tools strengthen decision-making, predictive logistics planning, and seamless collaboration among multiple stakeholders. It highlights the pivotal role of government initiatives in accelerating digital adoption and fostering integrated infrastructure development. Additionally, the study underscores several challenges unique to India, such as high implementation costs, fragmented logistics networks, limited digital literacy, inconsistent digital infrastructure, shortage of skilled labor, and regulatory complexities that impede the pace and depth of digital transformation. The findings indicate that while digital transformation presents significant opportunities for improvements in efficiency and sustainability, the challenges associated with its implementation remain unevenly distributed across different firm sizes and regions, particularly affecting micro, small, and medium enterprises (MSMEs) and rural corridors. The study wraps up with the need for strategic alignment, inclusive digitalization, skill development, and policy support to build a resilient, competitive, and sustainable logistics ecosystem in India, while also identifying potential avenues for future research in emerging digital logistics practices.