How did the differing strategies adopted to develop tourism in Guizhou (贵州) and Yunnan (云南) affect patterns of economic development and poverty reduction? The answer is paradoxical. Both provincial governments incorporated tourism as part of their overall development strategies, but their eventual tourism sites were distributed and structured strikingly differently. In Yunnan, although tourism contributed to rapid economic growth, it did not reduce rural poverty as much as might be expected from a large rural-based industry. By contrast, Guizhou’s relatively small-scale tourism industry, although not contributing significantly to growth, was distributed largely in poor areas and was structured to allow poor people to participate directly. The conclusions have implications for our understanding of provincial development strategy in China and ways that tourism can be used for development and poverty reduction.