Total quality management (TQM) refers to a way of management wherein senior management is committed to guiding employees in continuous improvement in all processes, services and products, with the ultimate goal of satisfying customer requirements and expectations. The purpose of the present study was to examine the impact of leadership, organization culture (OC), customer-oriented strategy (COS) and human resource empowerment (HRE) on innovation, as well as the effect of innovation on TQM for sustainable development in Greek luxury resorts with sport and recreation facilities and services. A quantitative 5-point Likert scale method was utilized for the purpose of this study, and an online questionnaire survey was adopted for the data collection. To evaluate the resilience of our model, we conducted structural equation modeling using SPSS and AMOS software. Varimax rotation with Kaiser normalization was utilized to enhance the robustness of the analysis. A total of 895 questionnaires were successfully gathered from 454 luxury resorts. This study validated that leadership, OC, COS and HRE positively impact the luxury resorts’ innovation and thus support that innovation had a significant impact on TQM, which in turn leads to their sustainability and effectiveness and is supported by the resource-based view (RBV). Furthermore, this study is the first within the Greek hotel industry that jointly estimates the influence of leadership, OC, COS and HRE on innovation and its concurrent effect on TQM for sustainable development, which has not been methodologically considered before and provides useful policy implications for managers within the hotel industry.