In this paper, the author examines the socio-economic approach that could influence the future development of the economy and culture on the island of Dugi Otok. It is emphasized that the development of tourism and other economic activities on Dugi Otok can serve as an example for larger islands in the Croatian part of the Adriatic Sea. The key focus is on sustainable tourism development, which requires alignment of all other production and exploitation activities with the principles of sustainability. Dugi Otok is considered an untapped potential of the Croatian Adriatic, with abundant resources waiting to be properly utilized to preserve the authentic island experience. The purpose of the paper was to demonstrate that, alongside a sustainable amount of mass tourism, it is important to develop an appropriate quantity of specific tourism products that will contribute to authentic and sustainable tourism development on the island. This paper highlights the possibilities for tourism development on Dugi Otok and encourages reflection and finding solutions for the future tourism development on the island. The keywords encompassing the topic of the paper are Dugi Otok, tourism development, sustainable tourism, local community, stakeholders of tourism development.