This study investigates the effect of Green Innovation (GI) on Small and Medium-sized Enterprises’ (SMEs) Business Sustainability (SBS) in the Sultanate of Oman, emphasizing the mediating role of Green Consumer Purchasing Behavior (GCPB). Integrating the Natural Resource-Based View (NRBV) and the Theory of Planned Behavior (TPB), the research develops a dual-theory framework linking organizational innovation capabilities with consumer-driven behavioral mechanisms. Using a positivist, quantitative research design, data were collected from 150 SMEs operating across multiple sectors in Oman. The analysis was performed using Partial Least Squares Structural Equation Modeling (PLS-SEM) via SmartPLS 4 to assess measurement and structural relationships among the constructs. The results demonstrate that GI has a significant impact on SMEs' sustainability in both economic and social dimensions, whereas its direct effect on environmental sustainability is insignificant. However, when GCPB is incorporated as a mediator, the indirect relationships between GI and all three dimensions of SBS become significant. Specifically, GCPB fully mediates the GI-environmental sustainability link and partially mediates the GI-economic and GI–social sustainability links.  These findings confirm that consumer purchasing behavior serves as a critical behavioral bridge, translating internal innovation efforts into measurable sustainability outcomes. The study further shows that GI explains 54.2% of the variance in GCPB and, together with GCPB, accounts for 33.7%, 44.3%, and 63.6% of the variance in economic, environmental, and social sustainability dimensions, respectively. Theoretically, this research extends sustainability literature by integrating strategic (NRBV) and behavioral (TPB) perspectives, highlighting that the success of green innovation depends on both firm-level innovation capabilities and consumer-level behavioral intentions. Practically, the results provide insights for SME managers and policymakers by emphasizing the need to align innovation practices with market education and consumer awareness initiatives. Encouraging eco-innovation, promoting green financing schemes, and fostering consumer trust through transparent environmental communication can accelerate the transition toward sustainable business models. Contextually, the study provides empirical evidence supporting Oman Vision 2040, highlighting the importance of innovation, environmental stewardship, and responsible consumption in achieving national sustainability objectives. Overall, the findings reveal that green innovation and consumer purchasing behavior are mutually reinforcing mechanisms that advance SME competitiveness and contribute to Oman’s sustainable economic transformation....