Sri Lanka was one of the first developing countries in the tropics that focused on tourism to generate additional jobs, raise foreign exchange earnings, and to diversify the economy. Coastal zones in the South and the West of the island have been on the forefront of tourist infrastructure development. Here, large hotels were built, which today dominate over the traditional character of many villages. This development was accompanied by a subsequent rise of secondary tourist infrastructure (small restaurants, souvenir and gem shops), involving a large proportion of the local population in tourism. This paper describes the development of tourist infrastructure in two villages, one consisting mainly of large hotels, the other primarily of guesthouses. The carrying capacity and the tourism life-cycle concept are applied to analyse the situation in the villages with respect to aspects of scale. Results indicate that scale is an important factor to be considered when defining carrying capacities. Moreover, there is evidence that carrying capacities are exceeded because they are defined by perception rather than scientific analysis.