The basic objective of this doctoral dissertation is to identify all theoretical assumptions and to offer valid empirical evidence on the impact of new knowledge on the competitiveness of small enterprises in hospitality industry. Theoretical and practical aspects of knowledge are researched as the basic entrepreneurial resource, starting from the adoption of new knowledge, its management and application of modern information technology. The notion and significance of education is researched, then the significance of e-education and lifelong education in the European Union and the Republic of Croatia, training and improvement for enterprise spirit, with a special review of theoretical and practical aspects of human and intellectual capital as important competitiveness factors. Relevant aspects of small enterprises are individually researched, as well as distinctive determinants of entrepreneurs and managers, desirable entrepreneurial features and promotion of small enterprises. The significance and history of small enterprises in hospitality industry is researched, with a special emphasis on hotel and restaurant industry. Major attention is given to the analysis of secondary and higher education of the personnel needed in hospitality and tourism, as well as the personnel for tourist animation, sport and medicine. The significance of business intelligence and modern information technology is individually researched, as well as e-trade and e-business in the creation of competitive advantage of small enterprises in hospitality industry. The research of competitiveness and competitive advantage of small enterprises in hospitality industry is the centre of attention as well as of possible potentials for its increase, such as: business ethics, social accountability, sustainable development, marketing and management. Finally, educational system is researched and possible models for the increase of new knowledge and competitiveness of small enterprises in hospitality industry. Modern economies of the entire world tend towards knowledge-based economy, so knowledge and knowledge management have become the key strategic issue of each enterprise. Positioning of knowledge as the key resource and function enables competitive advantage on the market. For the purpose of empirical verification or denial of general and special initial hypotheses and conclusions derived in an analytical, synthetic, deductive and inductive manner, own empirical research is conducted, and in some cases already published results and conclusions of empirical researches of relevant domestic and foreign authors and institutions are used. The subject matter and objectives of research within the framework of this dissertation are oriented towards theoretical elaboration and empirical assertion or refutation of one general and four special hypotheses. A special scientific contribution of this doctoral dissertation to the theory and practice of applying new knowledge is in the building of competitiveness of enterprises and small enterprises sector in hospitality industry, since a systematical outline of theoretical knowledge and empirical evidence regarding this topic are presented, since the found status in application of new knowledge is critically analyzed, since the methodology of researching the relation and degree of using new knowledge and education to the creation of competitive advantage of small enterprises in hospitality industry is elaborated, compliant with researches in domestic and foreign scientific literature. Findings of empirical research in this doctoral dissertation undoubtedly confirm how crucially important new knowledge, information technology, lifelong education and education of hospitality employees are for the increase of competitiveness of small enterprises in hospitality industry.