Smart cities are integral and sustainable, and their goal is to enable greater quality of human life and environmental protection. A smart city reduces energy costs and consumption, creating a cleaner environment and raising the standard of living of residents. The purpose of the paper is to highlight the potential of smart city and green economy as a precondition for smart city in order to quickly and easily address the challenges and problems of pollution that are an increasing problem today. These challenges include, for example, overcrowding of cities, especially tourist destinations, leading to a number of pollution, with the highest emphasis on water, air and public surface pollution. The aim of this paper is to present and emphasize the importance of smart city and smart destination for solving these problems and challenges. In addition, the paper will clarify the relationship between smart city and sustainable development, and specify and define the reasons that lead to improved quality of life and more successful business operations. The very development and functioning of this concept will be illustrated by the example of the city of Dubrovnik, which was proclaimed the best Croatian smart City in 2019, and the destination that continues to work on the progress, development and spread of new smart solutionsand innovations. Based on the example of the city of Dubrovnik, we strive to encourage other large cities and destinations to adopt a smart development concept.