The Third Plenary Session of the 20th Central Committee of the CPC has taken improving the institutions and mechanisms for fostering new quality productive forces in line with local conditions, and improving the systems for promoting full integration between the real economy and the digital economy as one of the important strategic tasks for the construction of modern socialist country. The comprehensive promotion of digital transformation for businesses has become a major strategic task in the current and even the whole 14th Five-Year Plan period. Agriculture is an important production sector in China’s national economy, and in order to promote the digital transformation of the agricultural industry, the Chinese government has issued a series of policy guidance documents in recent years. Under the support and guidance of those policies and the influence of the current increasingly turbulent and complex market environment, more and more agribusinesses are taking digital transformation as an important development strategy for the future. How to improve the competitiveness of agribusiness and the quality of agro-industrial development through digital transformation has also become an important issue faced by the business community and academia, and clarifying the relationship between digital transformation and the competitiveness of agribusiness is also one of the proper meanings. This paper clarifies the direct impact mechanism of digital transformation on the competitiveness of agribusiness enterprises and the mediating and regulating mechanisms at the theoretical level, and conducts an empirical test based on the panel data of China’s A-share listed agribusiness firms for the period from 2001 to 2020. The results show that: first, digital transformation and its two sub-dimensions, digital production and management and digital business, significantly improve the competitiveness of agribusinesses, and the impact of digital production and management is greater; second, mechanism tests show that digital transformation improves the dynamic capabilities of agribusiness firms in the three dimensions of perceived adaptive capacity, learning and absorptive capacity, and innovative capacity, and further enhances the competitiveness of the firms, i.e., dynamic capabilities play a fully mediating role in the impact of digital transformation on the competitiveness of agribusiness firms; third, both the average education level and stability of TMT play a positive moderating role in the impact of digital transformation on the competitiveness of agribusinesses, while the size of TMT plays an inverted U-shaped moderating role. The conclusions still hold after controlling for endogeneity issues and a series of robustness tests. Finally, policy recommendations for improving the competitiveness of agribusinesses based on digital transformation are proposed at the firm and government levels. This article incorporates digital transformation and competitiveness of agribusiness into the same analytical framework, which has certain theoretical value for expanding the theoretical system of management of agribusiness in the context of digital economy. At the practical level, it can not only provide practical guidance for agribusinesses to enhance their competitiveness through digital transformation, but also provide empirical evidence for governmental departments to further improve relevant policies.