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Tourism has contributed significantly to economic growth, and the government is the leading actor in the tourism development process. This article aims to discuss the role of village government in rural tourism development. The research was conducted qualitatively with a case study in Pujonkidul, a tourist village that is growing and developing into a rural tourism destination rapidly in Indonesia. The research data were collected through a series of in-depth interviews with village governments and main actors in the rural tourism development process. Observation and study of document also carried on during the process of collecting data at the village. The result of study show that the local government is able to carry out all government functions in tourism development (coordination, planning, regulation and legislation, entrepreneurship, stimulus and promotion, social tourism role and boarder role of interest protection). This study also found a new function of government in tourism development which is the main finding of this study, namely institutional development. Therefore, the authors argue that the village government can conduct rural tourism development locally and effectively with its functions and authorities. This finding of study can be adopted and developed in the other villages in the process of rural tourism development. The limitation of this study has ignored the discussion of villagers' participation in the rural tourism development process that is the essential form of rural development issues. This limitation is an important topic for future research.

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