This study investigated how South African Small and Medium Enterprises (SMEs) use Information and Communication Technology (ICT) and Dynamic Capabilities (DCs) to achieve competitive advantage in a changing business environment. The study explored the purposes for which South African SMEs use ICT in a changing environment, as well as the types of organisational capabilities or DCs that can significantly impact on competitive advantage within the SMEs. The study examined the contingent effect of firm size and age on the ICT capabilities, ICT utilisation, and absorptive and innovative capabilities of South African SMEs.