During recent decades, tourist industry remarkably achieves an explosive growth all over the world, nevertheless, each destination can only sustain a specific level of acceptance of tourism development beyond which further development can result in socio-cultural deterioration or a decline in a quality of the visitors'' experience. The social carrying capacity of a destination is the ability to absorb tourism development before negative impacts are felt by the local residents and the host community ceases to satisfy and attract tourists, consequently, the concept of social carrying capacity is strongly associated with residents'' attitude toward tourism. Drawing from current literature, residents'' attitude toward tourism development and its following impacts are proposed, being preceded by detecting tourism impacts classified under three different groups including socio-cultural, economic and environmental consequences. Furthermore, focusing on how tourism is perceived by residents, the present study is going to analytically discuss the factors influencing on residents` attitude toward tourism and its consequences. Accordingly social exchange theory is adopted as a theoretical framework for developing an understanding of residents'' attitude toward tourism, and the Maslow's hierarchy of needs is going to be tested to demonstrate whether it can support residents'' attitude toward tourist impacts in this specific situation or not. The study was conducted in March 2010, the peak tourist season, at Fahadan district, a heritage urban fabric located in historic city of Yazd. Two hundred thirty-six respondents in Fahadan arranged in three different groups including residents, shopkeepers and public sector providers complete the survey. The research shows that respondents support the current magnitude of Tourism and favor its expansion. The result is strictly generalized to all three different groups of research sample population. The findings of this research reveal that residents'' perception of benefits from tourism is closely associated with their attitudes toward tourism in a positive direction which confirms the usefulness of social exchange theory in explaining residents'' perception toward tourism development, however, no specific and clear proportion is found between the resident- evaluated impacts and those derived from Maslow's theory, mainly because some of the socio-cultural aspects of their residential environment beside the sense of identity are of more importance than some difficulties that may hinder residents'' routine life. This true fact indicates that Maslow's hierarchy of needs is not the proper theoretical framework to explain the whys and the wherefores of residents'' evaluation of tourist impacts in this specific situation. Tourist environmental benefits are the most significant factors influencing Fahadan residents'' support of tourism development. Furthermore, the results show that there is a direct relationship between the attitudes of the host community and the benefits they gain through tourism, their attitude toward the future of destination influenced by tourism, dependence of destination to tourism impacts, and finally the level of community concern about cultural issues and identity crisis. The study also emphasizes that the host community is mainly concerned about man-made environmental values and the authorities'' primary focus on the touristic aspect of their environment instead of the residential aspects of the place they live in.