Shovel Knight Dig launched for Windows, Nintendo Switch, and iOS and tvOS through Apple Arcade on September 23, 2022.

[2][3] Players cannot remain in the same location for too long, or an unstoppable buzzsaw will follow them through the level and kill Shovel Knight upon contact.

[1][2] Gameplay is centered around collecting as much treasure as possible to buy useful upgrades at shops, such as increased hit points or limited-use Relics that provide various effects.

[3][5] A permadeath feature causes Shovel Knight to lose all upgrades upon dying, returning the player to the surface with a portion of their collected treasure.

[2][4] At the surface, the player may spend the treasure on a variety of items, including tickets that allow Shovel Knight to start at a later section, sets of armor that provide useful benefits, or keys that can unlock new Relics.

Catching up to the Hexcavators, Shovel Knight learns that the team was assembled to search for a secret treasure, which they intend to sell in exchange for wealth and fame.

Shovel Knight gives pursuit, confronting the Hexcavators just as they unearth the treasure: a magical amulet housing an evil spirit called the Enchantress.

In a post-credits scene, Shovel Knight shows his partner an old relic he kept inside the bag, which he uses to open the secret entrance to their former hideout, the Burrow.

Development lasted a total of four years,[10] with Yacht Club Games openly discussing different concepts and ideas with Nitrome, while checking on the team on a weekly basis.

[10][14] A free DLC update called Fate and Fortune was released for iOS and PC on March 17, 2023, introducing quality-of-life changes, a music track from Jake Kaufman, and a new "Knightmare Mode" available to players who had already completed the game.

[22] PCMag echoed this sentiment, saying that Shovel Knight Dig did not feel unique in an indie game market saturated with the roguelike style.

"[24] On the other hand, PCMag wrote that levels would become less and less interesting once the player learned their unique mechanics, saying that compared to the original Shovel Knight, "Dig feels a bit like a step back".

[3] Nintendo Life dissented, writing that the generated levels felt like they were made by humans and not a computer programs, due to their unique mechanics.