Mongolia’s tourism industry has fully recovered after the COVID-19 pandemic, with an increase in foreign tourists. New international hotel chains are also opening and providing services. Mongolia has started to classify hotels by star system according to the new standard adopted in 1998. The Mongolian Standard “Hotel Service Quality Rating and Basic Requirements” MNS 5927:2008, which regulates hotel business activities in the laws, regulations, programs, plans, resolutions and orders in force in the Mongolian Tourism Industry, is the only legal document and national rating system for determining service quality. This study covered 4 and 5-star hotels that meet the Mongolian Standard “Hotel Service Quality Rating and Basic Requirements” MNS 5927:2008. This research assessed the expectations and perceptions of service quality in Mongolia’s four and five stars hotels by applying a modified version of the SERVQUAL model. A convenient sample of 270 guests drawn from six 4, 5 star hotels was used in the analytical stage. It also examined the relationship between overall satisfaction levels and the five service quality dimensions reliability, responsiveness, assurance, empathy end tangibility. The findings indicated, as a whole that the hotel customers’ perceptions of service quality provided by the hotel industry were lower than their expectations and the gap between customers’ expectations and perceptions were significant.