At one time the expression "digitally manipulated" referred to moving things around by hand, using some or all of one's fingers (digits) to position things carefully . Nowadays it signifys the way a pixelated computer image has been enhanced or retouched using a software program like photoshop.
A digital image is different from a film image.Traditional film image editing is known as photo retouching, using tools such as an airbrush to modify photographs, or editing illustrations with any traditional art medium. Graphic software programs on the other 'hand' which can be broadly grouped into vector graphics editors, raster graphics editors, and 3d modelers, are the primary tools with which a computer user may manipulate, enhance, and transform images. Many image editing programs are also used to render or create computer art from scratch.
My favorite program for doing this sort of digital image manipulation is Photoshop.
While it used to be that you could often tell if a photograph had been altered, with digital image manipulation programs like Photoshop you can't tell anymore. Many funny and unusual effects can be created, which if done right, can trick the viewer into thinking that what you are looking at is real and that the camera simply recorded what actually happened.
Like a magic trick the 'slight of hand' is created by using computer technology rather than using any hands at all.
Although all the stones in this old slate wall were laid by hand and in the original sense of the word 'digitally' manipulated into place, ( in this case by Cumberland farmers walling nearly two-hundred years ago ) the photo above was not in any way 'digitally' altered. While the image may at first be difficult to figure out, once you realize that it is the throughstones I am lying on, the photo makes sense.