The concept of sustainable tourism emerged as a reaction to the impacts of tourism development. This paper shows the relevance of sustainable tourism to tourism decline and the rising interest in de-growth. Mixed-methods research in the Isle of Man, UK, was carried out by analysing 355 postal questionnaires sent to randomly selected island households, and conducting 32 in-depth personal interviews. The research revealed a series of negative environmental and social consequences of tourism decline in a small island. Such consequences are found to occur despite successful local diversification into other industries, notably offshore finance. Consequences of decline are revealed as tangible, e.g. facilities closure, and as less tangible, e.g. a sense of rejection by off-islanders, and have led to an increasing sense amongst residents of isolation and loss of local attractiveness. Results suggest tourism decline, de-growth and economic replacement require sustainable management in order to facilitate change. Measures such as urban and rural landscape protection, may reduce adverse effects of decline. A re-assessment of the application of the principles of sustainable tourism in the context of decline, rather than development, is needed.