This paper examines the ways to enhance local peace through environment-friendly tourism. It identifies linkages among environment, tourism and local peace, looks at the trend of the tourism sector's role in peace-building and explores potentials and challenges of its engagement in building local peace in Nepal. The paper also presents two examples of community participation in tourism. It argues that peace, environment and tourism are all vulnerable to local conditions. In addition to meeting the needs of tourists, it is vital to ensure community participation and protect the environment. After all, this is the venue from which local peace begins its journey.