The discrete manufacturing industry in China is currently being transformed and upgraded. Digital transformation and intelligent upgrade is an inevitable choice for China's discrete manufacturing industry, as intelligent manufacturing can promote the quality, efficiency, and competitiveness of discrete manufacturing. The sub-sectors of discrete manufacturing in China differ significantly and require diversified paths for digital transformation and intelligent upgrade. In this paper, we first summarize the typical characteristics of the discrete manufacturing industry, explore the challenges regarding the digital transformation and intelligent upgrade of the industry, and elaborate on common key technologies including advanced manufacturing, new-generation information, and new-generation artificial intelligence. Subsequently, we investigate four typical cases to present the frontier application progress in the field in China and propose the following key development tasks: (1) achieving breakthroughs in key enabling technologies for intelligent manufacturing, (2) developing intelligent manufacturing equipment, (3) building digital and intelligent workshops and factories, (4) providing digital and intelligent services, and (5) building standards and safety systems. Furthermore, it is necessary to accelerate pilot applications, highlight domestication, increase the reserve of high-tech talents, and formulate relevant laws and regulations in the future, to promote the high-quality development of China's discrete manufacturing industry.