Abstract: The synergistic development of data elements may lead to a nonlinear effect when enterprises use data elements to empower digital technology innovation. Based on the data of China’s A-share listed companies from 2015 to 2023, this paper empirically examines the impact of data elements utilization on enterprise digital technology innovation on the basis of quantifying the utilization of enterprise data elements using Word2Vec algorithm and machine learning model. The results show that there is a U-shaped relationship between the utilization of data elements and the innovation of enterprise digital technology, that is, the low level of data elements utilization will inhibit the innovation of enterprise digital technology, and only after reaching the critical point will it promote the innovation of enterprise digital technology. And this U-shaped relationship is more prominent in non-state-owned, small-scale, non-diversified businesses, and companies with high financing constraints. Further mechanism tests show that the utilization of data elements has an effect on the digital technology innovation of enterprises by affecting the efficiency of factor allocation and the concentration of supply chain. The conclusion of this study enriches the literature on the influencing factors of enterprise innovation from the perspective of data elements, reveals the “double-edged sword” effect of new production factors on enterprise digital technology innovation, and has strong guiding significance for promoting the value release of data elements and leading the innovation and development of enterprises.