Purpose -This paper aims to analyze developments in the Russian hospitality sector and present the results of qualitative research conducted at the Faculty of Economics, Lomonosov Moscow State University, in 2014-2015. Design/methodology/approach -This paper offers a general observation of the local environment and comparative analysis, and statistical analysis and content analysis are used to shed light on current developments in the Russian hospitality market. The issues are examined using the available secondary data, including relevant empirical studies and feedback from hoteliers and hotel guests. A case study method is applied to reveal the challenges facing hotel chains in Russia and to propose the most effective directions for hotels to provide services that meet world standards and customer expectations. Findings -In recent years, there has been a major growth in the hospitality sector in Russia. This paper confirms and explains the long-term attractiveness of the Russian market. Hotel chain development is one of the most promising directions for both international and Russian hotel brands. The growing role of the internet as a distribution channel is underlined, as well as long-term relationships, positive experience and positive emotions, as a way to gain loyal clients. Originality/value -The current study adds to the literature on emerging markets by presenting an overview of the main trends, challenges and factors for success in the Russian hospitality market.