In the contemporary context of rapid digitalization and evolving youth interests, traditional art forms such as Nanjing Paper-Cutting face significant challenges in preserving their cultural significance. This study explores the semantic transformation of Nanjing Paper-Cutting symbols within digital games and their potential value in cultivating cultural and artistic literacy among youth. The analysis of the paper-cutting symbols in the digital game Nanjing Paper-Cutting Show examines the reinterpretation of these symbols in virtual environments and how they enhance young people's understanding of traditional culture through interactive experiences. The employment of semiotic analysis and case study methodologies in this paper unveils the processes of visual, interactive, and cultural shifts associated with the digital expression of paper-cutting symbols. The findings indicate that digital games not only stimulate interest among young people in traditional arts but also ascribe new meanings to traditional symbols within contemporary contexts, thereby enhancing their cultural and artistic literacy. Ultimately, this paper proposes strategies for promoting the application of traditional arts in digital education, offering insights for the inheritance and innovation of Nanjing Paper-Cutting in modern educational settings.