The world phenomenon, tourism, today takes place in almost all parts of the world. In Croatia, it has a very important role because it is an integral part of the country's economy. Small family hotels bring high economic effects, so its development is greatly encouraged in the Republic of Croatia. The hotel industry is the most present form of accommodation in the world and one of the leading industries. The trends that prevail in the world's tourism market also determine the trends in the hotel industry. Hotel industry in the classic form of large hotel chains is not widely represented, but from year to year there is an increase in the number of smaller family hotels and private accommodation. The reason for this is the tourist demand, according to which the tourist offer is tailored. Precisely for this reason, the topic of the thesis was chosen, the role and importance of small family hotels in the development of tourism in the Republic of Croatia, in order to show the opportunities and threats of this type of work. The terms important for understanding the family hotel industry will be defined along with the possible business plan for a future family hotel on the west coast of Istria, on the Lim kanal. The purpose is to show the necessary content and offer of hotels for efficient running of business, and to what extent the use of natural resources contributes to business. Due to the upward trend of this type of business in the last few years, the possibility of extending the tourist season in Istria has been seen as a new opportunity.