This paper investigates the relationship between digital skills of the workforce and income inequalities within regions. By combining three databases – EU-LFS, EU-SILC and ESCO – the analysis studies the relationships between digital skills and income inequalities for an unbalanced panel of 103 European regions for the period 2003–13. The results show that the relationship between digital skills and inequalities varies substantially across income groups and, in particular, that digitalisation exacerbates inequalities among the less affluent whereas it mitigates them among those with higher income levels.