Accurate simulation models are essential for excavator stability control, particularly when addressing complex interactions across subsystems such as the engine and hydraulic system. The Simulink-based model used in this research incorporates a complete excavator system, including engine, hydraulic, and mechanical dynamics, requiring precise parameter estimation (PE) to handle nonlinear behaviors and unmeasurable parameters like friction coefficients and initial pressures. Traditional PE methods often struggle with these challenges, leading to inaccuracies in dynamic modeling. To address this, a novel hybrid PE framework is introduced, integrating machine learning (ML) techniques such as random forest (RF) and gradient boosting (GB) with optimization methods like gradient descent (GD) and nonlinear least squares (NLS). This framework bridges physicsbased simulations and real-time IoT-acquired data, enabling accurate estimation and correction of parameters. Validated using CAN bus-compatible data, the framework achieves exceptional metrics, including an RMSE of 0.3921, an MAE of 0.0557, an R 2 of 0.9999, and a SMAPE of 0.84%, setting a new standard in the field. The hybrid model surpasses traditional approaches by aligning simulated outputs with real-world dynamics, offering scalability across varying conditions and demonstrating significant potential for real-time predictive maintenance, operational optimization, and integration with digital twin technologies.