Abstract- Tourism development in Mabul Island began in the early 1990s after the discovery of Sipadan Island as one of the leading dive destinations in the world. Mabul, located next to Sipadan Island, is a tourist destination on the famous scuba diving as muck diving. The diversity of the coastal depths in this island is a habitat to many unique and exotic species of corals, marine flora and fauna. This paper examines the transformation of scuba diving tourism development and its implications for the fishing community in the resort island for the last ten years. In 1999, there were only three resorts operating in Mabul. Presently, two new resorts have been added, Borneo Divers Mabul Island Resort and Scuba Junkie Mabul Beach Resort. To meet the increasing number of international tourist arrivals, and to offer affordably-priced scuba diving packages, some small business owners have commissioned the building of guest houses near the fishing community village on the island. There have been significant changes from the effects of tourism development on the resort island in the past ten years. Although resorts in Mabul own most of the land, island residents who live in the inland village of Mabul have been allowed to build houses on the sea; in contrast, residents in Musu’ are not permitted to erect any house on the sea, but instead allowed to construct houses on land. However, the numbers and the areas for such houses are limited. To realize the concept of sustainable development, the rapid pace of development in Mabul has to be controlled so as not to exceed its carrying capacity and also to ensure that the fishing community will gain benefits from the development.