Community-based tourism serves as an economic catalyst for enhancing the socio-economic well-being of Indigenous peoples in developing countries. While extensive research has explored its functional and structural aspects, the potential of community-based tourism to foster cultural empowerment though Indigenous ontologies and traditions institutions remains unexplored. This ethnographic study investigates the role of community-based Indigenous tourism (CBIT) in reinforcing cultural identity among the Khokana Newars of Nepal through their traditional institution, Guthi. Employing Indigenous methodology and qualitative methods, the research reveals Guthi's role in disseminating cultural knowledge, preserving cultural memory, and strengthening individual and collective identity within tourism contexts. The study expands the discourse on CBIT by introducing cultural empowerment as a core element, highlighting the interplay between Indigenous institutions, community identity, and tourism development. It advocates for a paradigm shift towards culturally empowered tourism initiatives that actively integrate Indigenous voices and lived experiences, promoting cultural integrity, and self-determination.