Saudi Arabia, the world's largest oil exporter, earned about SAR62bn (US$16.5bn) from the annual pilgrimage rituals of Hajj and Umrah in 2012, a 10 percent increase from the previous year, Arab News reported.
The revenue from the pilgrims to the holy city of Makkah, Madinah and other religious sites in the kingdom, accounts for about 3 percent of the kingdom's gross domestic product, the Jeddah-based newspaper said.
More than 7m pilgrims visit Saudi Arabia's holy sites every year with religious tourists spending about US$10,000 per visit.
Buoyed by high oil prices, the kingdom, which has the largest economy in the Arab world, is spending US$219bn this year on education, healthcare, social benefits and infrastructure. The government is also encouraging the private sector to invest in expanding the tourism and hospitality industry in the holy city of Makkah in a bid to create more jobs.
Tourism is the second largest industry in the country to employ Saudis, accounting for 8 percent of total jobs in the country, according to the Saudi Commission for Tourism and Antiquities.
The kingdom is forecast to have 343,000 hotel rooms by 2015, up from 250,000 in 2011, according to Business Monitor International.
Saudi Arabia's economy is set to slow this year to an estimated 4.2 percent from about 6 percent in 2012, according to International Monetary Fund projections.