Artificial Intelligence (AI) is one of the emerging technologies being adopted both in the government and the public sectors with nascent applications. Although there are several anticipated optimistic effects of the implementation of AI in governments’ functions, they need to manage and overcome several challenges to successfully adopt AI technologies and realize their benefits. AI applications were examined from the literature, with limited research studies to address the challenges in the public sector. The purpose of this paper was to explore the challenges of AI adoption in the public sector and present their impacts. Findings showed that AI challenges were perceived differently by various scholars, with limited empirical data to showcase the real adoption in the public sector. A conceptual framework on AI adoption challenges and its impact on the public sector was developed by integrating information provided by current literature. The results from applying such framework could be significant for the policy-makers and the government entities who aim to implement the AI in various units of the government and improve their processes and services to the community.