Domestic residents'' labor participation is insufficient, and household financial risks are looming. Can the development of digital finance be helpful? Based on the data of Chinese Household Finance Survey, researchers explore the influence of digital finance on residents'' labor participation and household financial vulnerability from a micro perspective. It is found that the development and use of digital finance are helpful to promote residents'' labor participation and reduce household financial vulnerability. The mechanism analysis shows that digital finance promotes residents'' labor participation by increasing residents'' entrepreneurship and attracting labor mobility, and the increase of residents'' labor participation helps to reduce household financial vulnerability. In addition, the effect of digital finance to reduce household financial vulnerability can also be achieved by improving household financial literacy and increasing the proportion of household financial assets allocation. Heterogeneity analysis shows that the marginal effect of digital finance on promoting residents'' labor participation and reducing household vulnerability exists both "digital dividend" and multi-dimensional "digital divide" for individuals, households and regions with different characteristics. The final conclusion provides a policy reference for optimizing the development of digital finance and using digital finance to solve the two major problems of insufficient labor participation rate and sharp increase in household financial risks.