Governments look to entrepreneurship as a main pillar of the economic development. The current study investigates the role of Egyptian governmental authorities in supporting entrepreneurship in the tourism industry in Egypt. It discusses the opportunities and challenges of entrepreneurship and their impact on the tourism industry development. The study employs the deductive approach using quantitative method based on a questionnaire survey to explore the opportunities and challenges relevant to entrepreneurship in tourism sector. The findings revealed that the entrepreneurship in tourism industry benefits from the initiatives launched by the Egyptian government while there are some challenges relate to risk-taking by youth entrepreneurs and lack of sufficient entrepreneurship education in tourism.  It is also found that encouraging entrepreneurship is significantly contributing to tourism industry development in the country. The present study has useful implications to policy-makers in tourism and hospitality education and relevant governmental authorities in tourism sector in Egypt and other developing countries.