A digitally compensated hysteretic power supply with enhanced resolution is provided. Such a power supply includes a comparator that is used to compare a load current sense signal with an internal signal generated from a digital-to-analog converter (DAC). A compensation circuit at a DAC input operates to improve current accuracy beyond the given DAC resolution. The current sense signal is converted to its digital equivalent, which is fed to a proportional-integral (PI) compensation loop, which in turn generates a relatively precise high resolution DAC input value. The DAC uses the higher part of the DAC value. The lower part of the DAC value is treated as a duty cycle number, and the DAC output is toggled between two levels at this duty cycle. This toggling generates a current output signal having a value that is the average of the two toggled values.