In Nigeria’s creative economy, the nexus of sustainable fashion entrepreneurship and artificial intelligence (AI) offered a developing chance for youth empowerment.  However, little is known about how much AI adoption affected young fashion designers’ environmental sustainability and entrepreneurial preparedness.  This study examined how the adoption of AI affected the entrepreneurial growth of young people working in fashion design companies in Lagos State, Nigeria, paying special attention to how AI promoted environmentally friendly business practices.  Through stratified and purposive sampling, 150 respondents were chosen from Lagos’s fashion design hubs, innovation centres, and vocational schools.  Using a descriptive survey design, information was gathered via questionnaires and interviews.  The tools evaluated AI integration, entrepreneurial readiness, and eco-friendly design practices. The data were analysed using both descriptive (mean and standard deviation) and inferential (Pearson correlation and linear regression) statistics. The findings revealed a significant predictive effect of AI use on the capacity to apply sustainable design practices (β = .61, p < .01) and a strong positive relationship between AI adoption and entrepreneurial readiness (r = .67, p < .01). These results demonstrated how AI tools like digital sketching, virtual prototyping, and predictive analytics can revolutionise innovation and green entrepreneurship.  The study, which was guided by Schumpeter’s Innovation Theory, showed that students’ perceptions of the utility and usability of AI tools influenced the integration of AI in fashion education, which in turn encouraged creativity and “creative destruction.”  The ability of young people to engage in eco-conscious fashion entrepreneurship was found to be greatly enhanced by customised AI-driven interventions.  In order to enhance sustainable development through creative enterprise, the study suggested policy support, capacity building, and the integration of AI literacy.