All peripheral regions face significant challenges with tourism development. This research initially acknowledges the challenges facing peripheral regions, which can be either geographical, such as access and infrastructure, or perceptual in nature, such as image related. Subsequently the challenges for tourism provision and development in the northeast of Scotland are discussed. Primary data have been collected from tourism providers in the region in an attempt to identify the specific challenges that face northeast Scotland. This region of Scotland faces a unique challenge in that the region effectively has two micro-economies; Aberdeen city and its surrounding area benefit from the influence of a relatively buoyant oil industry, whereas the more remote areas to the north and west exhibit many peripheral tendencies. This juxtaposition of two contrasting operating environments in a peripheral area highlights the unique challenges for tourism development in this part of the world. Copyright © 2003 John Wiley & Sons, Ltd.