This study is conducted to find solutions to support communities in coastal craft villages to transform and expand sustainable livelihoods associated with tourism development towards a blue economy. Research results show that coastal areas associated with craft villages have rich tourism resources. However, the current status of tourism exploitation here is not commensurate with the potential. In addition, the coastal communities' primary livelihood sources are mainly related to fisheries production, sedge weaving, embroidery, handicrafts, and fine arts, with economic efficiency yet to be determined. At the same time, they are facing many unsustainable challenges due to the impacts of climate change, population growth, environmental pollution, and resource depletion. Therefore, the problem for communities in coastal craft villages today is to transform their livelihoods to develop tourism to take full advantage of their advantages and bring about high and sustainable economic efficiency. The research results can be considered a valuable reference for state management agencies in proposing mechanisms and policies for sustainable socio-economic development in the current context.