In the past, economy of Ladakh was mainly dependent on the agricultural sector, government jobs and armed forces but now the tourism sector has emerged as a main contributing agent to the economy. The impact-oriented studies related to tourism for Ladakh are limited to social, cultural, and geographical aspects, lacking a focus on impact of tourism on economic development of Ladakh. Hence, the present study provides an empirical analysis of the impact of tourism on the economy of Ladakh. Consequently, the study provides effective suggestions to policymakers for development of sustainable tourism that boosts economic development in Ladakh.