Tourism has a great potential for economic development and employment generation for Albania. It is a labour intensive sector that creates many jobs at all levels. According to ILO, the global tourism sector accounted for more than 235 million jobs in 2010 representing 8% of global direct and indirect employment, or one in every 12 jobs. In most developing countries tourism offers opportunities for local residents to generate income and to participate in decent work, with low barriers to entry and a wide employment multiplier-effect. However, employees in this sector are often faced with low pay, low job security, a lack of social security, weak career prospects, unsafe working conditions, etc. A high proportion of seasonal and part time jobs, is a common feature of tourism employment. Albania has excellent tourism development potential. Tourism growth need to be driven and supported by conscientious marketing, creative design of products, appropriate infrastructure, high quality human resources and by a tourism “business climate” with clear rules of the game and appropriate structures to ensure its longterm economic viability. Human Resource Management is key to the success of this service industry, and especially capacity development. Therefore the aim of this article is to explore how different theoretical models of HRM can be applied in the tourism sector in order to ensure sustainability of this sector. The paper aims to provide an analysis of the dynamics of the capacity development sector for tourism in Albania, in terms of actors and factors operating in this sector. The analysis is mainly based on desk research analyzing previous studies performed in this field by national and international institutions, key policy documents, national strategies and official national statistical data, and theories etc.