There is only one village on the island and all the paths from the land lead there. Only a few dozens people live on the island permanently and they mainly live from tourism or from planting and exporting cashew nuts. Accommodation is situated at the beach Ao Yai mostly in bamboo cabins. Coral reefs suitable for scuba-diving and snorkeling are on the sea shore. Diving trips are organised regularly. The calm atmosphere on the island draws many people from the whole world.
Koh Phayam was hit by a tsunami in 2004 but there are no visible traces of it today.