Air transport as an organized form of service provision, especially in passenger transport, can be important for increasing the number of foreign tourists. Globalization and the development of information technologies have contributed to the development of the business model of airlines, which has enabled a significant reduction in the cost of air travel and the accelerated development of this industry. Therefore, the emphasis is placed on the global trend of development of low-cost airlines, their way of doing business and the effects they have on the development of tourism. The increase in the number of low-budget airlines has multiple effects on the development of international tourism and passenger transport due to cheaper transport, which is made possible by improving the competitiveness of air transport after its deregulation. In addition, lower prices and a better logistical position can contribute to an increase in the number of foreign tourists and a higher income for this industry, as well as other related economic activities. The aim of this paper is to examine through theoretical and empirical insight whether there is an impact of low-cost airlines on the volume of air traffic and the intensity of passenger transport, with an emphasis on existing literature, as well as empirical confirmation on the example of Serbia. The conducted research has important implications, since in pandemic conditions, further development of low-budget airlines is expected to contribute to the recovery of air traffic and tourism.