Digital Business Ecosystem (DBE), as it sounds, is a digitized form of business ecosystem amalgamating ICT (Information and Communication Technology) with business networks. Malaysian small and medium enterprises (SME) can be tuned into a collaborative and interdependent socio-economic business environment when they are jacketed with ecosystem. In a DBE, small and medium enterprises are provided with the freedom to integrate their services across organization and turn them into offerings. This helps them in many ways resulting in improved performance of employees and customer satisfaction. Surveys have shown that Perceived Usefulness (PU) and Perceived Ease of Use of SME employees are some of the key variables which are amplified. In Malaysian context, small and medium enterprises are very important to regional economy which is largely dependent open state market. DBE links the small and medium enterprises in a way to create a win-win situation for all the stake holders. The paper provides an evolutionary framework for small and medium enterprises which is hoped to achieve the long standing goal of a true collaborated network. It should help small and medium enterprises climb up the ladder of Eadoption by taking a step further ahead of ecommerce and ebusiness. © 2011 IEEE.