By 2016, Rio is expected to have an additional 250 hotels totalling upto 20,000 rooms, when it hosts the summer Olympics.
"For the 2016 Olympics, we need an extra 12,000 rooms in Rio," ABIH-RJ President Alfredo Lopes told a press conference.
Thanks to tax incentives provided by City Hall, the sector "has invested $1.5 billion in construction of new hotels," he noted. "We'll jump from 30,000 rooms today to 50,000 in 2016."
For next year's football World Cup, he said occupation of all hotels was already 74 percent guaranteed.
Lopes said the industry has set up a watchdog group to prevent price gouging and to ensure that prices are in line with services offered.
But he rejected any government role in fixing prices.
He said the role of government was to promote Rio, the gateway for Brazilian tourism, by ensuring greater security, notably with police control of major slums once under the sway of narcotraffickers.