Objective: Under the background of accelerating the promotion of the deep integration of the digital economy and the real economy to empower high-quality development of the modern forestry industry, studying the influence mechanism of digital rural construction on the development and upgrading of forestry industry can provide a scientific basis for formulating policies and strategies for high-quality development of forestry by digital empowerment in areas rich in forest resources. Method: Based on the panel data of 26 mountainous counties in Zhejiang Province from 2001 to 2021, we built the evaluation index system of county digital rural construction level to measure the level of digital rural construction, and the two-way fixed effect model, intermediary effect model, threshold effect model, and spatial Durbin model were used to quantitatively analyze the impact of digital rural construction on the development and upgrading of forestry industry and its mechanism. Result: 1) From 2001 to 2021, the level of digital rural construction in 26 mountainous counties in Zhejiang Province showed an increasing trend, among which the level of digital rural construction in cross-development counties was higher than that in ecological development counties. From 2001 to 2021, the scale of forestry industry development in 26 mountainous counties of Zhejiang Province continued to expand, but there were obvious regional differences and serious polarization. From 2001 to 2021, the rationalization of forestry industry structure in 26 mountainous counties of Zhejiang Province increased slightly, and the degree of advanced forestry industry structure volatility rose. 2) Digital rural construction can promote the development and upgrading of forestry industry, which means digital rural construction has a significant positive impact on the development scale of forestry industry, rationalization of forestry industry structure, and advanced forestry industry. There is a threshold effect on the impact of digital rural construction on the rationalization of forestry industry structure and the advanced forestry industry structure. 3) Digital rural construction can promote the development and upgrading of the forestry industry through technology empowerment, labor empowerment, and governance empowerment. 4) There is a positive spatial spillover effect of digital rural construction on the development and upgrading of forestry industry. The digital rural construction can significantly promote the development scale of forestry industry, rationalization of local forestry industry structure, and advanced forestry industry structure, at the same time, it has a significant positive impact on the development scale, rationalization of forestry industry structure and advanced forestry industry structure in neighboring areas. Conclusion: From 2001 to 2021, the level of digital rural construction in 26 mountainous counties of Zhejiang Province continued to improve, the development and upgrading of forestry industry were improving, and factors such as technology application level, human capital level, and value realization efficiency of forest ecological products affected the digital rural construction to promote the development of forestry industry to varying degrees. Therefore, all county units need to accelerate the digital rural construction and make efforts in terms of the application of innovative technologies, vigorously introducing talents, improving the ecological governance capabilities of the forestry sector and the operation and management level of forestry enterprises, and cultivating leading forestry enterprises and giving play to the role of radiation and driving force, adapt to local conditions and carry out categorized policies. Thus, it will promote the development and upgrading of forestry industry in mountainous counties, and create a demonstration model for the construction of high-quality development of forestry with digital empowerment.