["Business Strategy and the Environment, EarlyView. ", "\nABSTRACT\nThe implementation by organizations of environmental practices related to circular economy can play a key role in helping solve important environmental problems such as climate change, pollution, and overconsumption of natural resources. A relevant theoretical and practical research topic is to study the role of internal determinants that can facilitate the implementation of circular economy. Circular economy has been mainly examined in manufacturing organizations, with few studies in the service industries. This paper examines two important internal drivers of circular economy (quality management and digitalization) in the hotel industry, using a questionnaire completed by 268 Spanish hotels and PLS‐SEM as the analytical method. Results show that quality management and digitalization positively influence circular economy, and that digitalization plays a mediating role between quality management and circular economy.\n"]