Structural change in the tourism industry is a potential driving force for tourism demand. Using sectoral-level data of capital formation, employment, and value-added as diversification measures, a positive relationship is found to exist between sectoral diversification and tourism demand in Macao. Heterogeneous effects on market origins of varying saturation levels show that sectoral diversification is a potential strategy for attracting visitors from more distant and less saturated origin markets. In order to build up a long-lasting resilience to external shocks, development policy should focus on cultivating market incentives for private sector stakeholders to participate in the diversification process.