In the context of the burgeoning digital economy, digital inclusive finance plays a crucial role in fostering regional innovation, entrepreneurship, and economic restructuring. Findings indicate that digital inclusive finance substantially boosts urban entrepreneurial activity, with this impact being particularly pronounced in cities possessing high administrative classifications, substantial economic scales, advantageous geographical positions, and those focused on non-productive service sectors. Its mechanism of action is mainly reflected in enhancing urban innovation capability, stimulating residents' consumption, and expanding credit supply. Further analysis reveals considerable heterogeneities across various urban characteristics and industry types. Concurrently, digital inclusive finance stimulates entrepreneurial activity via mechanisms such as factor concentration and spatial spillovers. This research offers a theoretical foundation for refining digital inclusive finance policies and invigorating urban entrepreneurial dynamism. Moreover, it holds significant implications for fostering green and innovative economic growth and contributing to the achievement of "dual carbon" objectives.