It is clear that domestic tourism globally is much greater than international tourism in terms of volume of visitors. According to some studies, domestic tourism flow worldwide may soon be 10 times larger than international tourism flows. Despite this promising value, many governments and researchers tend to overlook this market at the expense of international tourism. This problem is further aggravated by lack of consensus on ‘who’ should be included under the definition of a domestic tourist. Moreover, measurement of domestic tourism is said to be more difficult as citizens do not cross their national frontiers unlike international tourists. Because of these and other problems, domestic tourism is not playing its role to the desired level, especially in developing countries like Ethiopia. This work is aimed at exploring the problems, challenges and opportunities of domestic tourism development in Ethiopia taking Aksum as a case study. Therefore, this work can be helpful to lots of groups including researchers, development agencies, tourism businesses, tourism policy implementers, etc.