Tourism and hospitality are important segments of the Croatian economy. The share of the tourism sector in GDP for 2016 was 11.4 percent, and 24 percent of the total number of foreign overnight stays in 2019. fell on the hotel industry. In order to achieve the best and most profitable results, it is important to strive for a better level of efficiency. The question of achieving efficiency especially arises after the devastating 2020, which was marked by the Covid-19 pandemic and the almost absolute cessation of tourist traffic. In order for hotels to get through the crisis as soon as possible, attract new guests and rebuild their business, they need to improve their performance and invest in efficiency levels. This efficiency in this paper was measured using Data Envelopment Analysis (DEA). 69 medium and large hotels in Croatia in 2019. were taken as a sample. It was concluded that the average efficiency of Croatian hotels is low and amounts to 51 percent. Only three hotels proved to be efficient. The aim of this paper is also to examine the impact of exogenous factors on hotel efficiency. With the help of truncated regression, the influence of independent factors of ownership, age, location, hotel size and star rating was examined and it was concluded that all variables (except age) play significant and important role in determining the achived level of efficiency.