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How Do Hotel Star Ratings Actually Work?

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Now that 2020 is finally in the rearview mirror and things are starting to slowly open back up again, many of us are making plans for our first big post-pandemic vacation. Maybe you’re eyeing something close to home (staycation, anyone?) or perhaps a road trip to explore your home state. But, if you’re looking to venture farther afield on a trip that involves hotel stays, you might be wondering how to go about comparing one hotel to another.

Anyone who’s spent five minutes researching hotels knows comparison shopping isn’t easy. In theory, the hotel star rating system was designed to help customers compare apples to apples, so to speak. But, what makes a four-star hotel any better than a three-and-a-half-star alternative? And how much better? How does a “luxury hotel” compare to an “upscale resort”? What do terms like “luxury” and “upscale” even mean? The short answer is: It’s complicated. Here’s the low-down on how hotel star ratings work — sort of.

It’s worth noting that there is no official governing body for hotel star ratings. Legally speaking, hotels in most countries can claim any star rating they like, and some do. Many independent hotels often self-rate with a mostly arbitrary star-rating that’s little more than a marketing ploy. Case in point: Dubai’s Burj Al Arab Jumeirah famously crowned itself as “the world’s first seven-star hotel” — a designation not recognized by anyone serious in the travel industry. Although, it’s done wonders for their image around the world and on The Travel Channel.

Most major hotel chains, however, maintain consistency between locations, no matter what continent they’re on. The United States and Europe use similar though slightly different star-rating systems. Hotels in the U.S. are ranked between one and five stars, while those across the pond typically max out at four stars. Generally speaking:

  • One-star hotels offer only the most basic accommodations. Here, guests can expect a bed, running water, and limited amenities. These are often independent hotels in out-of-the-way locations, and cleanliness may be questionable. They’re minimally staffed, and the front desk clerk could be the only full-time employee onsite. Most respectable travel organizations don’t even acknowledge the existence of one-star hotels, let alone recommend them to their customers.
  • Two-star hotels are a subtle step up from their one-star counterparts. They’re typically part of a larger, budget hotel chain (Think Red Roof Inn or Super 8), and may offer a few more amenities like televisions, sitting desks, and Wi-Fi.
  • Three-star hotels are midrange accommodations with all the essentials, plus decent security and a respectable level of cleanliness and sanitation standards. Some have a basic restaurant and at least one additional shared amenity like a pool or fitness center.
  • Four-star hotels are often larger and more upscale. They’re modern, stylish, fully-staffed, and feature all the essential amenities plus a few extras like a spa, multiple pools, or a rooftop bar.
  • Five-star hotels are the world’s most exclusive and luxurious properties with an elite level of customer service and a long list of upscale amenities. Think Ritz-Carlton Hotels and Four Seasons Resorts.

Travel websites and metasearch engines like Kayak and rank hotels according to their own subjective requirements. However, one site’s four-star hotel could be a mere three-star on a competitor’s website. There’s no right answer. Add in each site’s crowdsourced user ratings and things get even more ambiguous.

Standards also vary widely from continent to continent. In Latin America, Asia, and Africa, the rating “system” is hardly a system at all. Hotels often self-rate however they like. Nothing is stopping a windowless, back-alley hostel from promoting itself as “luxury accommodations.” In Europe, however, star ratings are often doled out by local governments and independent organizations, making comparison shopping a little easier. HOTREC, a collection of European hospitality associations, uses a strict, standardized system to rank its hotels.

In the United States, three leading organizations provide independent, third-party ratings and reviews of hotels across the country.


Beyond battery jumps and vehicle tows, the American Automobile Association (AAA) is also the most comprehensive and well-recognized organization for hotel ratings. The complete requirements for its Diamond Program are spelled out in this very long, publicly available PDF file. In short, it inspects tens of thousands of hotels every year, ranking them from “Approved” to Three, Four, and Five Diamond ratings. The requirements are the strictest of any U.S. organization by far. Only around 6% receive a Four Diamond status, while just 0.4% garner the coveted Five Diamond rating.

AAA Approved hotels are often very basic, but guests can count on them to be clean and safe. Only the essentials — a writing surface of some kind, a minimum quantity of bath soap, and a pool — are required. Five Diamond properties, by contrast, must have a large in-room desk with an ergonomic desk chair, a selection of high-end bath products, and a glamorous pool with meticulous landscaping and water features.


While AAA’s Diamond Program ratings rely on a straightforward feature checklist, Forbes takes a more subjective approach. Its inspectors look at lifestyle features like the quality of an onsite restaurant’s wine menu or the level of service at the hotel spa. Forbes’ official list of hotels is far more exclusive, however. It currently ranks nearly 2,000 hotels in more than 70 countries, and only features those with “recommended” or four- and five-star ratings.


Michelin is best-known for its highly sought-after restaurant stars. However, the company also rates hotels. Its Red Guides are among the oldest in the industry and were once considered essential for avid travelers. Their popularity has waned in recent decades, as the company has focused more on restaurants.

Whether or not hotel star ratings are useful nowadays is a legitimate question. The third-party guides published by AAA, Forbes, and Michelin were popular in a time before crowdsourced information. Today’s travelers have access to hundreds or thousands of online guest reviews for almost any hotel in the world. So for many, instead of asking “How do hotel star ratings work,” a better question might be, “Should you even care?”

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Mike Richard
Mike Richard has traveled the world since 2008. He's kayaked in Antarctica, tracked endangered African wild dogs in South…
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