Foreign direct Investment (FDI) is the key factor to socio-economic development of the Lao economy from 1986 until now. The government has attracted more foreign investors to invest in many sectors of the economy. This book will analyze foreign capital inflows into Lao P.D.R, related to FDI promotion policies and describes investment contributions by sector. The influences of FDI on the tourism development in different provinces were observed from tourism related sectors such as number of tourist arrivals, hotels, and travel agencies. In order to investigate these topics, there are a few important questions that need to find answers particularly on the implemented government policies. What were the government policies on FDI flow into Lao P.D.R, what the relationship between FDI and tourism is, and why FDI in tourism development is successful? Through the analysis of FDI inflow into Lao P.D.R, FDI inflow into the tourism sector, and management policies between central government and local level, the last part of the paper will summarize some recommendations concerning the improvement of FDI in tourism development in the future.