Purpose: Based on the innovation diffusion theory, this study explores the mechanisms for enhancing grassroots healthcare service capabilities through digital-intelligent empowerment (DIE), taking S Town in Southern Jiangsu as a case. It reveals the synergistic mechanism between technological empowerment and institutional reconstruction, providing theoretical references and practical strategies for the digital-intelligent transformation of grassroots healthcare. Methods: A single-case study method was employed, integrating participatory observation, semi-structured interviews, and archival analysis. Guided by the innovation diffusion theory framework, the study analyzed the dilemmas and diffusion mechanisms of DIE in S Town from dual perspectives of internal policy implementation and external environmental adaptation. Results: The research identified multiple challenges in DIE, including resource constraints, human capital gaps, and intergenerational digital divides, which triggered the burden phenomenon in grassroots healthcare services. S Town addressed these through a tripartite mechanism: technology-institution synergy, policy network restructuring, and environmental adaptation. Key strategies encompassed modular technology application, flexible data integration, community-driven diffusion for elderly populations, and intergenerational optimization of human capital. Conclusion: The digital-intelligent transformation of grassroots healthcare requires constructing an elastic institutional framework and socially embedded mechanisms to strengthen the deep coupling of technological and governance logics. Governments and grassroots actors should collaboratively advance dynamic adaptation and incremental innovation to bridge digital divides, enhance policy resilience, and improve service effectiveness.