Digital disclosure is the main way for stakeholders to understand a companys digital actions. However, in the absence of disclosure standards and effective supervision, companies have the opportunity to exaggerate the degree of digitalization to cater to capital market preferences. Hence, taking the samples of A Share listed companies from 2008 to 2021, this paper examines the impact of common institutional ownership on the overdisclosure of digital information. Research has found that common institutional ownership can effectively curb companies exaggerated digital disclosure behavior. The mechanism test shows that common institutional ownership can exert the effect of competition mitigation and collaborative governance, and reduce the excessive digital disclosure by enterprises. Heterogeneity analysis shows that only longterm common institutional ownership can suppress digital over disclosure, and common institutional ownership only has an inhibitory effect on digital over disclosure behavior of enterprises with lower marketization in their location and enterprises with lower tax and financial burdens. The study enriches the field of digitalization and enterprise information manipulation and provides a new analytical perspective on the behavior of common institutional ownership.