The negative impact of COVID-19 pandemic has seen SME's struggling around the world. With many quickly adopting digital technologies, such as AI, in their manufacturing or services operations to achieve sustainable development. This study aims to develop a framework that informs AI-enabled sustainable development for SMEs by integrating the relevant research in the field. In this framework, we identify the opportunities that the deployment of AI technology can do to alleviate the plights of SMEs in the post-pandemic era, including the impacts on work, organizations, and performance. We further explore the challenges that SMEs face in AI transformation and recommend strategies to take on those challenges. Finally we propose an agenda for future research based on technological challenges and environmental threats.