This study aims to depict the halal tourism concept, its business process, and investigate dilemmas faced by tourism industry and proposes strategies to resolve the constraints based on the best practice from the tourism business operators. In addition, this study tries to investigate the influence of various factors on halal tourism. Triangulation method used by combining personal in-depth interview, documentation/literature review and field observation to generate the discussion and conclusion. Interview process was conducted by selecting four tourism operators in Indonesia who won the best halal category award by The World Halal Travel Award in Dubai. Additionally, for the empirical analysis, a questionnaire was also developed, and data was collected from a total sample of 313 Muslim tourists in the region of Indonesia. Study reveals that instead of taking position as pure sharia-compliant business, all participants chose to become Muslim-friendly business. This moderate business process transformation helps to expand their market segment to Muslim tourists at tolerable cost. The existing dilemmas faced by all entities in tourism industry are as follows: there is no formal standard of halal criteria, high-cost business transition, lack of sharia-competent human resources and lack of promotion. Besides, findings through regression analysis specifies that there is a significant and positive influence of quality and certification of halal food, male serving in the restaurants, halal activities and separate recreational facilities on halal tourism industry. The study was engaged with the best practices from halal business operators. Further research is suggested to involve tourists’ perception of halal-related product, management, human resource and finance operated by the halal business operators. Meanwhile, this study has considered a limited number of factors influencing on the halal tourism with traditional analysis approach.