Research on second language (L2) writing suggests that student engagement with automated writing evaluation (AWE) feedback is influenced by various individual and contextual factors. Little attention, however, has been given to the role that students' digital literacy can play in this process. Increasingly, digital literacy is becoming indispensable in language teaching and learning as reading, writing, and communicating are conducted and mediated by digital technologies. This study explores how seven L2 students engaged with AWE feedback on their L2 writing in a Chinese university, analysing data collected from student written texts, AWE feedback, and student interviews. We found that the students engaged with AWE feedback in different ways in terms of their perceptions, attitudes, and revisions. The study shows that students' digital literacy has considerable impact on how they engaged with AWE feedback regardless of their L2 proficiency. We argue that L2 students' digital literacy, characterised by an awareness of the affordances and constraints of technologies, an ability to evaluate digital information, and a willingness to use digital technologies for peer collaboration, can be a key factor in effective student engagement with AWE feedback on L2 writing.