We propose an agenda for further research on digital innovation units (DIUs) that refines the current –mainly descriptive– body of knowledge. Receiving great attention in research as well as in practice, DIUs are dedicated organizational units whose role is to drive and support digital transformation by promoting diverse facets of digital innovation. Utilizing DIU knowledge from a theoretical literature review on DIUs and their role in digital transformation, the resulting research agenda assists in structuring the field by synthesizing and connecting the partly isolated knowledge chunks with each other. We illustrate a coherent picture towards theorizing DIUs using Whetten’s building blocks of theory. Researchers can draw on our core findings to understand the emerging phenomenon of DIUs and to use them as a stencil for conducting proper future DIU research. It simultaneously may guide practitioners to understand the nature of DIUs and their role in a firm’s digital transformation journey.