In recent decades tourism development has expanded on most Mediterranean islands. Focusing on the island of Crete, this study recognises tourism as a highly visible and controversial component of change. The existence of the necessary infrastructure, the natural beauty, the climate, the culture and the history have contributed to tourism expansion, with Crete now attracting approximately 25 percent of foreign tourist arrivals and 55 percent of the total foreign exchange earnings of Greece. The perceptions of the local community in tourism were studied using personal interviews with three community groups: local authority officials, residents and tourism business owners and managers. The aim was to examine their views on tourism development, in an attempt to establish overall desired directions for tourism development and to suggest effective tourism strategies and policies to reinforce positive outcomes and alleviate problems resulting from previous unplanned tourism development. The research findings identify much agreement among the three community groups suggesting that it is feasible to further develop tourism with the support of the community. Although the areas used in the sample were in the maturity stage of Butler's (1980) life cycle model and therefore it might be expected that the community would be at the antagonism stage of Doxey's (1975) model, this was not suggested by the findings. Tourism is viewed positively as a development option, and further tourism development, with conditions attached, is supported. The expansion of tourism has brought economic gains, employment creation, increased population, enhanced community infrastructure and cultural and environmental preservation. However, there is limited co-ordination of tourism activities and insufficient collaboration between the public and private sector. In addition, the island is dependent on foreign tour operators, and the tourism industry is uneven geographically and seasonally. Tourism has modified traditions and has affected the environment and society. Since community perceptions match reality (what is on the ground from development), problems are real and it is necessary to find solutions for their amelioration. As a result, policy implications emerging from the results presented in this thesis are discussed and future strategies are suggested.