With digital technology gradually joining the social production process, digital economy will have a profound impact on the internal structure of the industry. In order to study the impact of the digital economy on the internal structure of the service industry, this paper uses the panel data of prefecture-level cities from 2011-2019 for empirical analysis. The research results show that the impact of digital economy on the service industry structure is "high-end promotion" rather than "low-end locking". After a series of robustness tests, the results are still valid. In terms of mechanism, digital economy promotes the upgrading of service industry structure by improving the level of regional human capital. The spatial effect test shows that the development of local digital economy can promote the upgrading of the service industry structure in neighboring regions. Further analysis shows that the impact of the digital economy on the upgrading of the service industry structure is regulated by the level of human capital. When the level of human capital exceeds the threshold, it shows a continuous enhancement of the role of promotion. The research in this paper confirms that the digital economy is an important driving force for the upgrading of the service industry structure, which can provide useful inspiration for the digital economy era to break the "structural slowdown" of the economy and optimize the internal structure of the industry.