This paper studies the historical process of urbanization and hotel development using time-series data of Guangdong Province in China from 1994 to 2010. Research results are based on a systematic analysis studying the relationship between hotel development and urbanization. This study adopts pooled OLS, feasible generalized least square, and fixed effect model to study urbanization effects on hotel development. This study identifies that the GDP per capita, non-agricultural population proportion, hospital beds, length of highways, and domestic tourism are the key determinants affecting hotel development. All variables exhibit a positive relationship with hotel growth. This study provides insight and empirical evidences on how urbanization affects hotel development at the provincial level