Abstract For many countries the tourist industry is an important factor in general economic development and an important branch of trade. Tourism appears to be a trade, which increasingly has greater importance for the individual countries economic progress. Therefore there are increasing numbers of countries, which concentrate on the development of tourism, which leads to more and more tourist destinations to choose from. This means greater competition and the need for differentiation with regards to each destination. One of the most important parameters of differentiation is destination image. Due to tourisms intangible and changeable nature, the fate of many destinations depends on how they are presented and perceived by their surroundings and the potential customers. It is through a certain image that a destination, region or country is differentiated from all the others in the consciousness of the consumers/tourists. Destination image and destination branding seem therefore to be key concepts within tourism today. Through this thesis, I seek to examine the phenomena destination image and destination branding from different theoretical perspectives. In addition, I will further examine which problems Bosnia and Herzegovina – as a country, which is still under development as an independent country and has been through a difficult crisis – encounters, when it has to develop its image and identity as a tourist destination. Taking William C. Gartners article ”Image Formation Process” as my point of departure, I will investigate which factors have influence on the tourist’s perception of a destination image and also the image formation process of this. In addition, I will look more closely at the phenomenon destination branding, where I will regard branding as one of the tendencies in modern marketing, and look at similarities and differences between corporate branding and destination branding. Destinations are marketed more and more as brands, where the focus is on a series of emotional characteristics, personality features and values – which the potential customers can identify with. Thereby one attempts to steer the destination image in a certain direction with the intent to create a unique position in the tourist market. Inspired by the organisation model by Mary Jo Hatch and Majken Schultz, which reflects the dynamics and interaction in the understanding of the organisation both inwards and outwards, I put forward a destination branding model, which examines the various aspects of the branding process and their mutual connections. In the light of this, I will examine more closely the role of branding in the rebuilding of the destination image. In the light of the analysis of the branding strategies of Bosnia and Herzegovina, where it is TV-spots ’Enjoy Life - Bosnia and Herzegovina’ and the website www.bhtourism.ba, which constitute the empirical material, I seek to find an answer to if and how branding can contribute to changing the country’s image.