This research aims to evaluate the diversification strategy of the Cyprus coastal  tourism product by investigating the degree of success of the strategy in fulfilling its  goals of economic improvement, tourist satisfaction increase and image  enhancement. The evaluation of the strategy’s success is performed through an  examination of statistics whereby tourism revenue, tourist arrivals, seasonality and  the competitive position of the Cyprus tourism product are assessed through  secondary research. Primary research is performed to explore the degree of  destination image enhancement and tourist satisfaction improvement. In particular, a  comparison of the projected and the perceived image of the destination is performed  to explore any similarities and/or dissimilarities whereas the satisfaction of tourists is  measured across several destination attributes. In tourism studies the diversification  concept has not been extensively examined as little attention has been given to the  repositioning strategy of coastal resorts. Hence, the conditions under which the  application of the strategy becomes imperative are examined to increase the  understanding of tourism product diversification. The research focuses on Cyprus  which was selected as a case study for the following reasons: a) it is a popular  Mediterranean ‘sea and sun’ destination and b) it has been trying to reposition itself  through diversification of its tourism product