Katoomba's main industry is tourism based on spectacular mountain scenery. The rock formation known as the Three Sisters, viewable from Echo Point about two kilometres south of the main town, is the most famous feature. Other features of the Jamison Valley visible from Echo Point include Mt Solitary and the rock formation known as the Ruined Castle. A short walk from Echo Point leads to The Giant Stairway which provides access to a number of nature walks through the Valley. Some of these are quite rugged and not recommended for inexperienced walkers. Several of the Jamison Valley tracks including the Stairway itself were closed in recent years due to maintenance, but most have since been re-opened. The section of track between the Ruined Castle and Mt Solitary is not well marked, and recommended only for experienced bushwalkers. Bushwalkers in the area will be much rewarded as the local geography includes extensive areas of dense sub-tropical rainforest, hanging swamps and a series of spectacular waterfalls (albeit with a relatively low water volume).
Other attractions include Scenic World, a tourist complex in the southwest of the town. This site is home to the steepest funicular railway in the world, the Katoomba Scenic Railway, which was originally built to facilitate coal and oil shale mining in the Jamison Valley. Scenic World also offers the Scenic Skyway cable car, which travels over an arm of the Jamison Valley and offers views of Katoomba Falls and Orphan Rock. In 2004 the original Skyway car was replaced by a new car with a liquid crystal panel floor, which abruptly becomes transparent while the car travels. In 1983 construction began at the site on a rollercoaster called the Orphan Rocker; the track was completed, but this attraction has never been opened to the public. The nearby Jenolan Caves are the most celebrated of several similar groups in the limestone of the country being the oldest discovered open caves in the world.
Katoomba is well-served by hotels and guest-houses, the oldest and most prominent of which is the Carrington Hotel, established in 1882 and occupying the highest point in town. The nearby village of Leura also features numerous well-appointed hotels and health spas and Medlow Bath boasts the grand Hydro Majestic Hotel (yet only 3 star), originally built in 1891. The only 5 star Hotel is located in Katoomba. Lilianfels is home to Darley's Restaurant, a 2 chef hatted restaurant The busy town centre, centered on Katoomba Street, features dozens of cafes and restaurants, including the Paragon which dates the early 1900s, as well as a number of second-hand book and antique stores.
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