Tourism development is deemed an effective tool for poverty alleviation. By exploiting natural, cultural, and historical resources, this process contributes to creating economic opportunities, generating employment, and strengthening local identity. For a developing country such as Iraq, which struggles with economic challenges and has a single-product economy, tourism assumes significant importance. The Najaf–Karbala corridor possesses considerable tourism potential. In recent decades, the cities of Najaf and Karbala have hosted countless domestic and international visitors, particularly during the months of Muharram and Safar. This trend continues throughout the year, elevating the tourism status of these cities in comparison with other forms of tourism. This is a developmental study that uses a descriptive–analytical design and survey method. It examines the strengths, weaknesses, opportunities, and threats of religious tourism development along the Najaf–Karbala corridor. The statistical population includes tourists traveling along this route. Using Cochran’s formula, a sample size of 385 was determined. The current status of the region was analyzed using the SWOT analytical model and the Quantitative Strategic Planning Matrix (QSPM). The findings suggest that the Najaf–Karbala corridor has several strengths and opportunities, such as access to diverse accommodation services and the attraction of international pilgrims. However, poor transportation infrastructure and congestion are its key weaknesses and threats. The study proposes strategies including the enhancement of accommodation and transportation infrastructure, improvement of crisis management, expansion of communication networks, and strengthening of educational programs for local communities. It concludes that the successful development of this corridor calls for coordination of stakeholders, targeted investment attraction, and meticulous attention to environmental and social dimensions.