Tourism locations globally have dynamic problems in order to satisfy the increasing demand from tourists while preserving cultural and environmental abundance. The objective of this study is to examine the techniques of Knowledge Management, stakeholder involvement, and organizational performance in the context of sustainable tourism development at Tree Diamond Banyuwangi Tourism. The Interpretive Structural Modelling (ISM) method is employed to comprehend the hierarchical and causal connections among pivotal components. The research target is situated in a prominent natural tourist spot that encompasses Ijen National Geopark, Alas Purwo National Park, and Meru Betiri National Park. These three parks form a triangular area sometimes referred to as the “Tree Diamond”. The collection of primary data was conducted by means of structured interviews with tourism agencies, conservation agencies, natural resource conservation agencies, business managers, and environmental communities. The analytical findings indicate that Knowledge Management techniques have an impact on stakeholder engagement and have implications for organizational performance. Theoretical implications of this study expand our comprehension of the primary factors that influence the development of sustainable tourism. Additionally, the managerial implications offer practical assistance for stakeholders in the tourism industry. This research is anticipated to make a valuable contribution to the advancement of sustainable tourism.