Lately, we are becoming aware of the negative consenquences from fast and unmethodical touristic planning on economy, society and environment. Island is set, limited, ecologically sensitive and unrenewable space shared by greater number of different habitants. Development of tourism on Cres island increases pollution of water, air, land, overfishing, depredation of underwater arheological sites and impairment of ecosystem. Loss of traditional cultural customs, occupations and trades is inevitable. Therefore, development of tourism on Cres island should be considered sustainable in the long term. Sustainable touristic development on the island implies coexistence with traditional culture with optimal utilization of touristic resources, which implies economical and societal growth in tuned with ecosystem that affects them. Therefore this paper aims to define elements of sustainable tourism development, carry out an analysis of impact of tourism on Cres island and examine and give an outline of initiatives for sustainable tourism development on the Cres island.