Scotland has long been a subject of the tourist gaze. By consequence, its identity and material cultural have undergone significant transformation and invention. This paper will analyse the relationship between craft, souvenirs and the invention of tradition in the Highlands of Scotland.  It argues that national development agencies, in particular the Highlands and Islands Development Board (1965-1990), played a key part in shaping the identity of Scottish craft in the twentieth century, by promoting it as a traditional Highland product to be consumed by tourists. The Board’s motivation was to diversify the economy by increasing the number of light industries. In a bid to arrest the crippling economic and social decline that can be traced back to Scotland’s industrial revolution, craft was commodified. By outlining the socio-economic context in Scotland following the Second World War, the paper will demonstrate how craft came to be associated with national development, and subsequently promoted as a cultural product, and souvenir. Building on archival research as well as oral history interviews, the paper focuses on the ceramic industry, Highland Stoneware (1973-present). Highland Stoneware provides an important case study of how Scottish development strategy attempted to link craft with tourism, with lessons that can be applied widely. The paper is conceptually underpinned by Hobsbawm and Ranger’s invention of tradition and Glenn Adamson’s thesis of the invention of modern craft.  Richard Peterson’s production of culture theory, as well as theories of tourism in a post-industrial context, including the work of Dean MacCannell, Nelson Graburn, provide further support to the arguments in the paper. As a case study, the paper sheds important light on the role that national development agencies play in shaping a nation’s cultural products, the relationship between tourism and the invention of tradition, and the economic impact behind the promotion of craft as souvenirs.