Abstract: Tourism development in historical and cultural towns requires efficient participation of all parties to establish a balanced interest contract and mechanism jointly. The balanced distribution of interests will effectively ensure the orderly development of historical and cultural towns, ensure the balance of interests of all parties in the development process and promote the protection of historic towns. During the tourism development process of Lushi Ancient Town, balance between the local residents, developers and the government is required by doing a good job in pre-tourism planning, establishing an integrated management department of the ancient towns with participation of all stakeholders, and improving the supervision and feedback mechanism of tourism development. By doing this, the endogenous potential of tourism development in the Lushi Town and the overall development of the local social, economic and cultural development of the ancient town of Lushi will be achieved.

Key words: stakeholders, the equilibrium game theory, tourism development, the Lushi Ancient Town