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The aim of this study is to investigate the relationship between potential and realized absorptive capacity and cost advantage. This research was questioned by the quality department managers of the five star green star certificated hotels operating in Antalya through surveys and supporting interview forms. The reason for the selection of hotels with a green star certificate within the scope of the research is the positive results of the increasing in the environment-friendly business practices observed in the hospitality sector on the competitive advantage in recent years. The motivating factor in the present study is that in the literature, a limited number of studies were found that reveal the relationship of the cost-leadership strategy with the absorptive capacity that is described as acquisition, assimilation, transformation and exploitation of the knowledge on the environmental-friendly activities of hotels. With an empirical study of 9 semi-structured interviews with quality managers and 74 surveys of five star environmental friendly hotels in Antalya, both quantitative and qualitative findings provide evidence that potential and realized absorptive capacity reduce operational costs in environmental-friendly activities at hotels. In addition, the findings have shown that realized absorptive capacity has a mediating effect on the relationship between potential absorptive capacity and cost advantage. [ABSTRACT FROM AUTHOR]