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The idea of Smart Cities has been one of the key driving factors for the urban transformation to a low carbon climate, sustainable economy and mobility in recent years because of the alarming situation of global warming. One of the industries with swift growth is hotel sector and hence is one of the key contributors to carbon emission and leaves environment footprints. The new emerging concept of sustainable tourism is envisaged as an important part of the Smart Cities paradigm. Improving sustainability by saving energy is becoming a primary task toady for many hotels. A great opportunity is provided by Artificial Intelligence (AI) and Internet of Things (IoT) to assimilate different systems on a platform by encouraging and assisting hotel guests to operate through single device and optimizing hotel operations. Current research focuses to identify the strategic positions of a hotel in terms of sustainability, AI and IoT technology. Components that will be considered by Hotels for the strategic intention of adopting AI and IoT for environmental sustainability. Different development and modification needed to be taken if management wants high sustainability readiness and/or IoT readiness. This conceptual paper constructs on the comprehensive study and systematic review of different area where the hotels can feasibly implement AI and IoT for improving sustainably.