This study aims to advance our understanding of the strategic decision to innovate in automation (i.e., artificial intelligence, big data, and robotics) in family firms (FFs). To this end, we relied on the psychological foundations approach and the ambivalence in FFs, which gives rise to three archetypes of FFs: enmeshed, balanced, and disengaged. Moreover, we considered the negative and positive consequences of automation in terms of lower firm employment, lower employees’ satisfaction and well-being, and higher firm productivity and their impact on three main non-economic goals and priorities pursued by FFs: the relationship between the family and the employees, the pride of creating a strong image and reputation for both the family and the firm, and the feeling to be socially responsible. This study adopts a qualitative approach: we conducted three case studies involving an enmeshed, a balanced, and a disengaged FFs that registered a patent in automation technologies. We conducted semi-structured interviews with the family owner and the R&D manager. We found that enmeshed FFs will limit innovation in automation mainly based on emotional concerns (family level). Balanced FFs will support innovation in automation based on a balanced view between emotional concerns (family level) and economic aspect (firm level). Finally, disengaged FFs will support innovation in automation mainly based on the economic aspect (firm level). Our study makes a relevant contribution to the literature and has important managerial and policy implications.