The tourism industry is one of the fastest-growing markets, accounting for more than one-third of the total
value of the global service trade. It provides employment and economic security at the local level and helps maintain the
sustainable use of resources. For tourism to be sustainable, it is necessary to understand locals’ perceptions of the impacts
of tourism. Therefore, this study was conducted to assess locals’ perceptions of benefits, costs, support, satisfaction, trust,
participation, and neighborhood conditions of tourism in Nepal. A survey was conducted with locals to collect the
primary data. Structural equation modeling was run to assess locals’ perceptions of different aspects of entrepreneurial
development. Community satisfaction, trust in tourism institutions, power to influence, and neighborhood conditions
were related to tourism development's perceived benefits and costs. The findings of this study would be beneficial for
the successful development of tourism in Nepal.