Travelers prefer a local and non-fragmented travel experience. Tourism small and medium enterprises (TSMEs) are considered to be difficult to develop those innovative services because they are limited by the tourism resources they have. However, having tourism resources might not a source of competitive advantage, but the competence to use them. Thus, this study explores the contribution of tourism core competence to promoting entrepreneurial orientation and service innovation performance. A total of 178 TSMEs were sampled. The findings indicated that the innovation and risk-taking mediate the effects of tourism core competence on service innovation performance, whereas proactiveness does not.