The number of tourists coming to Ireland last year decreased for the first time in seven years, with tourism revenue falling by 2% to €6.3bn.
Figures for 2008, contained in a report by the national tourism development authority, Fáilte Ireland, show the number of overseas visitors to Ireland fell by 250,000.
Last year 970,000 US tourists came to Ireland, compared to 1m in 2007, and the numbers of visitors from Britain declined by 5% from 3.7m to 3.6m.
The numbers of domestic tourists stayed almost the same, at 4.3m, generating €1bn for the economy.
The research also shows that employment in the tourism industry fell by 10% last year.
Fáilte Ireland says rising costs, including local authority charges, increasing prices and labour costs have had an adverse affect on jobs.