Based on panel data from 31 provincial administrative regions in China from 2011 to 2023, this paper employs the Peking University Digital Inclusive Finance Index to construct a fixed-effects model and empirically analyze the impact of digital inclusive finance on the urban-rural income gap. Furthermore, it examines the underlying mechanisms through the lenses of innovation levels and urbanization processes, while conducting heterogeneity analysis from the perspectives of urbanization levels and regional disparities. The results indicate that the development of digital inclusive finance significantly narrows the urban-rural income gap. Robustness tests confirm that this conclusion remains valid after replacing variables, lagging explanatory variables, and adjusting sample ranges. Mechanism tests reveal that digital inclusive finance primarily narrows the urban-rural income gap by promoting regional innovation levels and driving the urbanization process. Heterogeneity analysis shows that the effect of digital inclusive finance in narrowing the urban-rural income gap is more pronounced in regions with moderate urbanization levels and in the eastern and western regions of China. This study provides empirical evidence for understanding the role of digital inclusive finance in promoting coordinated urban-rural development and offers references for relevant policy formulation.