In the era of exponential development of technology, new technologies like artificial intelligence (AI) have great impacts on organizations. By applying digital transformation, companies are creating new practices or updating existing applications to stay competitive in the market. Digital technologies have gotten to the top position in organizations’ business strategies. Artificial intelligence technologies can create a competitive advantage through digital strategy. To fulfill changed customer expectations, companies use artificial intelligence technology in their products and services. Artificial intelligence technologies provide some great opportunities. On the other hand, they are bringing out some serious challenges to organizations. Understanding the opportunities and challenges that AI provides is critical for organizations and society. There is a lack of knowledge about the challenges and opportunities of AI in digital transformation. This research addresses the challenges and opportunities by a comprehensive documentation about the insights derived from the existing literature. The research question was formulated as follows: What are the challenges and opportunities of artificial intelligence in digital transformation? As the research strategy, the systematic literature review method was selected. Data was retrieved by using Web of Science and Scopus databases, which enable the researcher to reach several databases like ScienceDirect, ResearchGate, etc. PRISMA framework was followed to reach the final number of articles to analyze. After reading all the studies, the data retrieved from 32 studies were analyzed through the content analysis method, and common themes were identified with the challenges and opportunities of artificial intelligence in digital transformation. The research results can be useful for organizations that wish to know the challenges and opportunities of using artificial intelligence in digital transformation and the actions to take to use these challenges and opportunities.