Businesses must digitally transform their organizational mindset to stay competitive and gain sustainable competitive advantage. Previous studies revealed that to achieve digital transformation (DT), organizations require strategic dynamic capabilities (DC) in order to discover new opportunities, sense and measure potential threats, exploit external inputs, and deal with new digital environments. However, the path to a complete theoretical and empirical understanding of the digital DC domain is yet in its early days. Moreover, prior research has largely concentrated on organizational DC internally, thus paying little attention to inter-organizational processes and not considering the requirement of new people for the development of the latter. In recent years, academic research has revealed that collaborations between different parties based on the choice of specific and strategic partner are key factor for the effectiveness of the improvement process of strategic innovation capabilities. Universities, especially entrepreneurial universities, are suitable partners for the transfer of both knowledge and ideas, as well as for the development of business innovation. Framed on these premises and based on a longitudinal case study carried out within an Italian university initiative, the goal of this study is to provide evidence that university-industry collaborations (UICs) are fruitful and key means to support and manage the exchange of stakeholders’ digital knowledge within an ecosystem and to develop digital capabilities across the involved firms. Results show that cross-border academic, industrial, and institutional interactions involve innovative and valuable processes able to develop critical DT dynamic capabilities, also suggesting empirical guidelines to educators, professors, and practitioners to structure and expand the innovation ecosystem between universities, businesses, and institutions. This study also offers managers and SMEs practical advice on digital transformation and an empirical model to help businesses compete and improve their strategic positioning through internal process digitization and business model innovation..