Due to the rapid development of the Tourism industry in Tibet, the number of hotels and quality of services has rapidly improved. We have an increasing number of international star hotels coming into play, and a growing number for local Tibetan families are starting their own guest house and hostel.
In recent years we have Shangrila Lhasa and intercontinental Lhasa paradise coming into the market. But the quality of Five-star hotel in Lhasa is not as it is at other places.
I would instead encourage you to the Tibetan-run Tibetan style hotels. The popular choices are Shambala palace, House of Shambhala, Kyichu hotel and Yak hotel. Those hotels are centrally located and have excellent friendly staff. Those hotels are like a small and warm family. We would instead suggest you to the small and warm family rather than living in a big and cold structure.
Here are post of where to eat in Lhasa