Indonesia, an archipelagic state in Southeast Asia, attracts many international and domestic tourists with its rich natural and cultural assets. The island of Bali is the most famous tourist destination in the country and is also known as the "island of the gods" due to the unique Balinese culture. Although tourism in Bali provides employment opportunities and makes the island one of the richest provinces in Indonesia, mass tourism in Bali has brought about many negative impacts. This diploma thesis, entitled "Mass tourism versus community based tourism in Indonesia", aims to identify the potential of Indonesia?s, and especially Bali?s, tourism sector to develop into a more sustainable form of tourism. Another goal of this thesis is to find out whether small-scale alternative tourism projects, such as community-based tourism projects, can be a sustainable alternative to the development of mass tourism. At the beginning of this thesis, sustainability in tourism is explained and examples of four specific forms of sustainable tourism are given. The subsequent chapter deals with the topics of poverty alleviation through tourism, which is a development strategy used by many less developed countries. In addition, different planning approaches are discussed. A general overview on tourism development of Indonesia and Bali is given and mass tourism in Bali is discussed in the form of a Strengths Weaknesses Opportunities Threats (SWOT) analysis. Four case studies were conducted in Java and Bali, which are examples of sustainable tourism ventures in Indonesia. The last chapter discusses the common strengths and weaknesses of the projects and provides a model for community-based tourism in Bali. Additionally, the different levels of tourism development are discussed and recommendations for improvements are given.