Abstract: Digital rural development is a strategic direction of rural revitalization, which has an important impact on the income of both rural and urban residents. Based on the national county digital rural construction index and matched county economic data, regression model and mediation effect model were used to analyze the impact of digital rural construction on rural and urban residents’ income and the mechanism of its effect from both theoretical and empirical levels. The following conclusions were drawn: (1) Digital rural development boosted rural and urban incomes with regional heterogeneity; (2) digital rural construction helped to narrow the urban-rural income gap and promoted urban-rural integration; (3) digital rural construction promoted the income of rural residents by enhancing the total factor productivity in agriculture and reducing the digital divide, and enhanced the income of urban residents by upgrading the industrial structure and expanding the consumer market.