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This article reveals the process of identity formation and transformation of a rural Korean folk village following its tourism development. The commercialization of cultural heritage, whether inherited from the ancestors of its residents or borrowed from other rural villages, allows for the appearance of a unique local identity. The newly constructed local identity initiated by tourism, however, can undermine other kinds of preexisting identity of the village. In Oeam village, after the introduction of tourism, locality is replacing lineage or blood ties in the making of a new identity. The local identity shared by the villagers may also differ, depending on the degree of their involvement, socioeconomic interests in tourism, and their lineages. For example, some villagers, who did not belong to the dominant lineage, were not able to possess their own distinctive identity because of their low socioeconomic and political status in the village. Now, the emergence of noticeable local identity can be found among them in the village thanks to their active involvement in the tourism development. On the other hand, relatively wealthy villagers with high lineage status still show a strong attachment to traditional consanguineous identity. Therefore, much more complicated and competing identities can emerge in the village, depending on the extent of the villagers’ participation in tourism.