Abstract: The purpose of this study was to assess the influence of project environment on adoption of digital tools among banana farmers in Rwanda under ICT4BXW project, Rwanda. This study assessed the influences of digital literacy on adoption of digital tools. System Theory, Lean Theory and Theory of Change grounded the research by employing a descriptive and correlational research design that uses quantitative and qualitative methods. A stratified random sample of 126 respondents was selected from 183 project stakeholders. Percentage of response rate was 79.36% from the sample size. Primary data were collected using structured questionnaires and semi-structured interviews, while secondary data were obtained from project reports, academic publications and analyzed using SPSS version 32, where descriptive statistics, Pearson correlation and multiple regression analysis were analyzed. Pearson correlation showed a strong positive and statistically significant relationship between digital literacy and adoption of digital tools among Rwandan banana farmers under ICT4BXW project with (r = 0.589, p = 0.000). Regression analysis demonstrated that digital literacy with β = 0.516, t =5.38 and p < 0.001 had significant positive influences on the adoption of digital tools The regression model produced an R-value of 0.666 and an adjusted R² value of 0.421, indicating that approximately 42.1% of the variation in the adoption of digital tools was explained by digital literacy. The study concludes that encouraging the long-term adoption of digital tools among banana farmers requires moderate to high-level digital literacy among banana farmers. To improve the adoption of agricultural digital tools in Rwanda, the study suggests that policymakers, extension service providers and development partners invest in training on digital devices and application; improve institutional and extension support systems and expand access to reasonable priced digital services to banana farmers in Rwanda.