Community-based tourism development in rural tourist destinations is hindered by the complex interplay of power struggles between the State, hoteliers, travel agents, local tourism players, host community and activists. Following Bourdieu’s ‘epistemologically reflexive’ sociology of everyday life, including his concepts of ‘capital’, ‘habitus’ and ‘field’, I examine the power relations between the Indian State, the regional government, the armed forces, private urban hoteliers and travel agencies, religious corporations, local tourism service providers (e.g. the ponymen and taxi operators) and the host communities operating at the tourism destination of Pahalgam in the Himalayan territory of the Indian-administered Kashmir. Drawing on ethnographic material collected during June–September 2017 and October 2018, I analyse the power relations in the context of a growing political conflict in the region. The central question this article addresses is how and to what extent these actors, particularly the Indian State, engage in contestations for dominance, insurrection and subversion over Pahalgam tourist destination. Theorising the embodiment of ponywālā1habitus, I demonstrate that ‘subaltern’ dispositions of the ponymen and their corresponding tourism practices of offering pony rides to tourists and pilgrims create boundaries within the destination ‘field’ of Pahalgam. Subsequently, I aim to show that such dispositions cultivate internalised beliefs or doxa among local community players, thus limiting their access to capitals (economic, social, cultural and symbolic) and ensuring the (re)production of their dominated position in the destination field of Pahalgam.