Digital leadership (DL) is key to driving innovation and efficiency in construction, especially with the opportunities offered by Construction 4.0 technologies. While DL competencies are important at all organisational levels, developing them in entry-level positions (ELPs) is especially critical, as these early-career roles are key to supporting future digital capabilities of the organisation. Therefore, identifying the challenges in this process is necessary to devise effective strategies for integrating DL at the entry level. This study aimed to identify the challenges in developing DL competencies among ELPs in the construction industry. Semi-structured interviews were conducted with construction professionals from Malaysia and Sri Lanka, and the data were analysed using thematic analysis. The analysis revealed that the identified challenges can be categorised into three main themes: Organisational, External, and Individual. Eleven of the twenty-three challenges identified are recognised under the organisational theme, while the external and individual themes have five and seven challenges, respectively. Many challenges are common between Malaysia and Sri Lanka, and some are unique to each country, indicating the importance of context-specific strategies in different locations. Industry stakeholders and ELPs can use the study findings to devise effective strategies for developing DL in construction. This study represents the inaugural effort to uncover the challenges in developing DL competencies among ELPs in the construction industry.