Digitization has changed the way individuals build relationships, work, and consume. Such changes have affected the fashion industry in significant ways, revealing a whole series of new practices, not only regarding the design and manufacturing processes but also modifying how products are displayed, distributed, and consumed.In the age of connectivity and technological innovation, a dematerialized economy is being shaped based on rethought consumption patterns and solutions to reduce energy demand. New concepts come together aiming at the possibility of economic development supported by sustainable social and environmental practices. Regarding this, the fashion industry has relatively recently embraced the dematerialization of fashion products, exploring different paths and opportunities that multiply the possibilities of relationships with the consumer and on the other promotes more sustainable and valuable processes.Since the outbreak of the covid-19 pandemic, luxury brands and large retailers invested in the incorporation of new technologies, especially regarding the digitization of clothing, where multi-million partnerships between fashion brands and the games industry in the development of skins for electronic games proved to be a promising investment. In addition, for many companies, the adoption of 3D design and computer graphics software for the creation, modelling and prototyping processes represents an optimization in the workflow, increasing productivity, efficiency and reducing the environmental impact. The boundaries between the physical and the digital seem to be progressively being blurred, offering new experiences to users. In these circumstances, the Digital Twins technology, already adopted by other industries, is now starting to find its place in the fashion system, showing a potentially disruptive impact on traditional retail and communication channels that pass from omnichannel to phygital up to a new hybrid reality.Considering the range of applications and usability opened by the digitalization of fashion, the emergence of new technologies (AI, VR, MX, Digital Twins) and the complexity of new challenges and impositions faced by the design field, the present paper aims to define innovative trajectories within the fashion retail sector, impacting both business models (in order to make it more sustainable and valuable) and consumer experiences. In addition, this paper intends to discuss how design could contribute to creating new sustainable experiences, supporting the transition between physical and digital spaces, as well as adapting operational practices to make the phygital process positive and viable.