This systematic literature review synthesizes the main results and conclusions of 33 studies published between 2020 and 2024 examining the dual impact of technology on teacher and student linguistic identities. Six main thematic clusters are identified: technology as a disruptor and reconstructor of teacher authority; technology as a space for plurilingual and translingual identity affirmation; digital policies, structural inequalities, and imposed identities; emotional regulation and the reconstruction of a “capable” digital teacher identity; specific technological affordances enabling identity work; and controversies and contradictory evidence. Overall, findings reveal that technology serves as a powerful mediator in teacher identity reconstruction, prompting shifts from traditional instructor to digital facilitator and cultural mediator. Simultaneously, technology also introduces significant tensions by amplifying sociolinguistic inequities, particularly in under-resourced contexts, where limited access to devices or connectivity can reinforce existing hierarchies. When applied with pedagogical intent, technology-enabled practices like digital storytelling and translingual projects become vital tools for affirming students’ plurilingual identities, allowing them to draw on their full linguistic repertoires. Moreover, reflective, technology-supported professional development is essential for navigating this complex identity work, as it helps teachers critically examine their own positionalities and biases. The review concludes that the influence of technology is shaped by pedagogical stance, institutional support, and engagement with power dynamics, advocating for its use to create inclusive, identity-affirming environments rather than enforcing standardization or a one-size-fits-all model of language instruction.