Typically, residents play a role in developing strategies and innovations in tourism. However, few studies have sought to understand the role of Islamic religiosity on the perceived socio-cultural impacts of sustainable tourism development in Pakistan. Previous studies focusing on socio-cultural impacts as perceived by local communities have applied various techniques to explain the relationships between selected variables. Circumstantially, the structural equation modeling (SEM) technique has gained little attention for measuring the religiosity factors affecting the perceived socio-cultural impacts of sustainable tourism. This investigation aims to address such limitations in this area of scientific knowledge by applying Smart PLS-SEM, developing an empirical approach, and implementing Smart-PLS software V-3.2.8. The proposed tourism model predicts the effects of the religiosity level on the perceived socio-cultural impacts of sustainable tourism development. In this study, we examine the relationships among religious commitments, religious practice, and religious belief and the socio-cultural effects of sustainable tourism. Our research identifies influential factors through an extensive literature review on communities’ religiosity and the socio-cultural impacts of developing sustainable tourism. We examine and analyze data based on 508 residents’ responses. The findings reveal an R² value of 0.841, suggesting three exogenous latent constructs, which collectively elucidate 84.10% of the variance in the perceived socio-cultural impact of sustainable tourism. The findings reveal that religious respondents with a higher religiosity level have a positive attitude towards developing sustainable tourism. These findings are helpful to understand the dynamics of communities’ perceptions, behaviors, quality of life, cultural aspects, and religiosity factors affecting sustainable tourism in Pakistan. This study is novel in the context of Pakistani cultural and social norms, and this study’s implications may provide further direction for researching and developing sustainable tourism in the northern regions of Pakistan.