ABSTRACT Tourism development has become a pivotal factor in driving economic growth and transformation in numerous regions worldwide. This study investigates the economic impact of tourism development on the local economy, focusing on the case of Udaipur, a culturally rich city in Rajasthan, India. Through a combination of quantitative analysis, surveys, and interviews, the research assesses the direct and indirect effects of tourism on various sectors, employment, income distribution, infrastructure, and sustainability. Descriptive statistics reveal positive perceptions among respondents regarding the overall impact of tourism development on the hospitality, transportation, and retail sectors in Udaipur. However, significant disparities emerge in opinions regarding income distribution and the equitable distribution of economic benefits. Statistical tests confirm the presence of notable differences in perceptions across different dimensions of tourism's economic impact. Despite challenges such as seasonality and sustainability concerns, respondents express confidence in the long-term economic benefits of tourism. The study underscores the importance of tailored policy interventions to address diverse stakeholder perspectives and ensure sustainable and inclusive tourism development.