Tourism is a heterogeneous system that gains an increasingly important role on a global scale. After the massive and expansive tourism development phase, there was a need for a balanced approach to tourism development that takes into account economic, ecological and social goals. The need for the achievement of balanced tourism development goals has been particularly emphasized in protected natural areas and the tourism development in protected areas has been presented in the research on the example of island Mljet. The aim of the research is to determine recommendations for further development of tourism on the island of Mljet based on the analysis of the situation, potential and limitations of tourism development. Primary and secondary data were used during the research. The results of the research show that all participants in the tourist system on island of Mljet have recognized the significance and role of specific selective forms of tourism in securing the goals of sustainable development. The recommendations for further development of tourism on the selected island have been thought-out regarding the necessity for selective tourism development.