The concept of the smart city represents the highest level of the Fourth Industrial Revolution (FIR) along with smart phones, smart homes, and smart factories. in its trajectory and process. Therefore, most governments around the world have tried to build smart cities in order to strengthen their urban competitiveness and improve the quality of life for their citizens in the digital economy. North America, the European Union (EU), and Asia have already carried out several pilot projects to build smart cities based on private-led, public-private partnerships, and public-led strategies, respectively. Smart cities can improve overall problems and resolve difficulties by 10–30% on average, which is regarded as an overall benefit of smart cities. At the same time, they can contribute to labour force disruptions, digital discrepancies, and threats to social coherence and inclusiveness, all of which result in socio-economic and political costs. The author examines the roles smart cities can play in the digital economy and in the completion of the FIR and focuses on whether smart cities can contribute to the creation of new opportunities for global economic growth as a new industry in the digital economy. Last, but not least, it examines their challenges for transforming digitization and smartness in reality. Additionally, it highlights future perspectives from the FIR in practical manners.