This study uses China Family Panel Studies (CFPS) data from 2010 to 2018 to empirically investigate the interplay between digital technology access, labor market behavior, and income inequality in rural China. The following salient conclusions are derived. Digital technology access has a substantial negative influence on individual income inequality in rural China, with a more pronounced inhibitory effect on inequality among low-income groups, males, middle and higher professional classes, and younger cohorts. Mechanism analysis suggests that digital technology access significantly impacts a range of rural labor practices, including increasing the frequency of digital technology use among rural inhabitants, decreasing credit costs, enhancing entrepreneurial activities, and boosting rural labor mobility. Based on these findings, this study proposes accelerating digital infrastructure development in rural regions, improving digital and financial literacy among rural residents, and refining inclusive digital financial services to facilitate more stable and sustainable progress to promote common prosperity.