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This literature review follows the PRISMA method to assess recent advancements in digital-oriented modular construction towards a sustainable and climate-neutral built environment, identifying research trends and gaps based on three pillars: digital tools, building solutions, and environmental sustainability. This review examines the integration of digital technologies with modular construction methods, extending the analysis to circular and bioclimatic efforts, renewable energy sources, and passive building design strategies. While most articles focus on BIM uses, there is an increasing emphasis on IoT applications that leverage real-time data to achieve sustainability goals. However, no full-scale automated Digital Twin was found in this context. Additionally, Building Energy Modelling (BEM) and Life Cycle Assessment (LCA) tools are frequently discussed, reflecting the push for climate-friendly housing. Despite the interest in parametric and generative design, the integration of machine learning and artificial intelligence applications for sustainable modular construction strategies remains underexplored. Only a few papers acknowledged reaching nZEB requirements despite the great emphasis on passive building solutions and renewable energy sources that contribute to this goal. However, material circularity has yet to achieve its full potential for sustainable modular construction. Moreover, there is some interest in off-grid modular buildings, although further research should be undertaken to analyse the modular construction feasibility for sustainable off-grid communities. Furthermore, the findings highlight the potential of digitalisation in modular construction to enhance efficiency and ensure environmental sustainability within the Architecture, Engineering, and Construction (AEC) sector.<\/jats:p>","DOI":"10.3390\/buildings15050765","type":"journal-article","created":{"date-parts":[[2025,2,26]],"date-time":"2025-02-26T08:28:31Z","timestamp":1740558511000},"page":"765","update-policy":"https:\/\/doi.org\/10.3390\/mdpi_crossmark_policy","source":"Crossref","is-referenced-by-count":30,"title":["Modular Construction in the Digital Age: A Systematic Review on Smart and Sustainable Innovations"],"prefix":"10.3390","volume":"15","author":[{"ORCID":"https:\/\/orcid.org\/0000-0003-0413-6178","authenticated-orcid":false,"given":"Diogo F. R.","family":"Parracho","sequence":"first","affiliation":[{"name":"CONSTRUCT-GEQUALTEC, Department of Civil and Georesources Engineering, Faculty of Engineering (FEUP), University of Porto, Rua Dr. Roberto Frias s\/n, 4200-465 Porto, Portugal"}]},{"ORCID":"https:\/\/orcid.org\/0000-0003-0890-9043","authenticated-orcid":false,"given":"Mohamed","family":"Nour El-Din","sequence":"additional","affiliation":[{"name":"CONSTRUCT-GEQUALTEC, Department of Civil and Georesources Engineering, Faculty of Engineering (FEUP), University of Porto, Rua Dr. Roberto Frias s\/n, 4200-465 Porto, Portugal"}]},{"ORCID":"https:\/\/orcid.org\/0000-0002-4819-0312","authenticated-orcid":false,"given":"Iraj","family":"Esmaeili","sequence":"additional","affiliation":[{"name":"CONSTRUCT-GEQUALTEC, Department of Civil and Georesources Engineering, Faculty of Engineering (FEUP), University of Porto, Rua Dr. Roberto Frias s\/n, 4200-465 Porto, Portugal"}]},{"ORCID":"https:\/\/orcid.org\/0000-0002-1452-4986","authenticated-orcid":false,"given":"Sara S.","family":"Freitas","sequence":"additional","affiliation":[{"name":"CONSTRUCT-LFC, Department of Civil and Georesources Engineering, Faculty of Engineering (FEUP), University of Porto, Rua Dr. Roberto Frias s\/n, 4200-465 Porto, Portugal"}]},{"ORCID":"https:\/\/orcid.org\/0000-0002-3228-6977","authenticated-orcid":false,"given":"Leonardo","family":"Rodrigues","sequence":"additional","affiliation":[{"name":"CONSTRUCT-LFC, Department of Civil and Georesources Engineering, Faculty of Engineering (FEUP), University of Porto, Rua Dr. Roberto Frias s\/n, 4200-465 Porto, Portugal"},{"name":"ALiCE\u2014Associate Laboratory for Innovation in Chemical Engineering, Department of Chemical and Biological Engineering, Faculty of Engineering (FEUP), University of Porto, Rua Dr. Roberto Frias s\/n, 4200-465 Porto, Portugal"},{"name":"LEPABE\u2014Laboratory for Process Engineering, Environment, Biotechnology and Energy, Department of Chemical and Biological Engineering, Faculty of Engineering (FEUP), University of Porto, Rua Dr. Roberto Frias s\/n, 4200-465 Porto, Portugal"}]},{"ORCID":"https:\/\/orcid.org\/0000-0001-9878-3792","authenticated-orcid":false,"given":"Jo\u00e3o","family":"Po\u00e7as Martins","sequence":"additional","affiliation":[{"name":"CONSTRUCT-GEQUALTEC, Department of Civil and Georesources Engineering, Faculty of Engineering (FEUP), University of Porto, Rua Dr. Roberto Frias s\/n, 4200-465 Porto, Portugal"}]},{"ORCID":"https:\/\/orcid.org\/0000-0002-0398-3423","authenticated-orcid":false,"given":"Helena","family":"Corvacho","sequence":"additional","affiliation":[{"name":"CONSTRUCT-LFC, Department of Civil and Georesources Engineering, Faculty of Engineering (FEUP), University of Porto, Rua Dr. Roberto Frias s\/n, 4200-465 Porto, Portugal"}]},{"ORCID":"https:\/\/orcid.org\/0000-0002-1026-4523","authenticated-orcid":false,"given":"Jo\u00e3o M. P. Q.","family":"Delgado","sequence":"additional","affiliation":[{"name":"CONSTRUCT-LFC, Department of Civil and Georesources Engineering, Faculty of Engineering (FEUP), University of Porto, Rua Dr. Roberto Frias s\/n, 4200-465 Porto, Portugal"}]},{"ORCID":"https:\/\/orcid.org\/0000-0002-8467-6264","authenticated-orcid":false,"given":"Ana Sofia","family":"Guimar\u00e3es","sequence":"additional","affiliation":[{"name":"CONSTRUCT-LFC, Department of Civil and Georesources Engineering, Faculty of Engineering (FEUP), University of Porto, Rua Dr. Roberto Frias s\/n, 4200-465 Porto, Portugal"}]}],"member":"1968","published-online":{"date-parts":[[2025,2,26]]},"reference":[{"key":"ref_1","doi-asserted-by":"crossref","unstructured":"Staib, G., D\u00f6rrh\u00f6fer, A., and Rosenthal, M. (2008). Components and Systems: Modular Construction Design, Structure, New Technologies, Birkh\u00e4user. DETAIL.","DOI":"10.11129\/detail.9783034615662"},{"key":"ref_2","unstructured":"Smith, R.E. 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