Artificial Intelligence is redefining the tourism industry by ensuring the accumulation of technologies in business operations and tourism-related activities and fostering economic growth and financial outcomes. From the automated reservation system, AI is increasing its branches toward personalized marketing, setting dynamic pricing models, and offering tailored experiences per guests' requirements. Tourism and hospitality-related services can strengthen smarter decision-making, certify efficient operations, and enhance service delivery to tourists. This chapter scrutinizes the sequential development of AI in tourism, examining assorted AI applications that have been applied to the tourism industry. AI creates new job opportunities, increasing efficiency at work, enhancing competitiveness, and encouraging economic expansion and growth, especially in developing markets. This chapter offers a thorough overview of the transformative role of AI in tourism-related business, economic development, and advancement challenges and opportunities AI presents to the industry.