This paper examines conventional wisdom about the superiority of the neoliberal market-led approach in leading regional tourism development. The rise and rise of neoliberal market management philosophies over the last 30 years has contributed to an incontrovertible 'truth' that regional tourism organisations (RTOs) established and led by business actors are best placed to lead regional tourism development. Despite this dogma, little evidence has surfaced to support the notion that market-led organisations offer a superior model of regional tourism governance. This paper examines the capacity of two different regional tourism organisations in Brazil, a market-led RTO and a government-led RTO, operating in the same geographical space to lead regional tourism development. Focusing on the capacity of each organisation to lead, the findings reveal that the capacity to lead requires more nuanced attention, and that both types of RTOs have an important, and potentially complementary, roles to play in leading regional tourism.