Despite an omnipresent call for public e-services, the potential of digitalization in the public sector is still untapped. A promising means to increase the use of public e-services may be explainability. In this study, we follow the Design Science Research methodology to propose and evaluate design principles for explainability of public e-services. We instantiate the design principles in cooperation with the German Federal Statistical Office using the example of its public e-service Personal Inflation Calculator. We evaluate the design principles in a user study with 226 users and an expert survey with 17 public sector digitalization experts. Results confirm the design principles’ utility and applicability. Furthermore, we investigate the impact of explainability on the use of public e-services. In a randomized online experiment with 204 citizens, we demonstrate the positive impact of explainability of public e-services on perceived ease of use, perceived usefulness, self-efficacy, trust, and intention to use. With our design principles, we provide applicable and prescriptive knowledge on explainability of public e-services. Our findings on the impact of explainability on the use of public e-services contribute to the understanding of the role of explainability in digitizing the public sector.