Overbookings, or double bookings, happen when a hotel sells more rooms than it has available for a given night. Many hotels do this deliberately to offset last-minute cancellations or no-shows and avoid losing revenue and occupancy. Of course, it can also happen by accident.

Hotels are allowed to overbook because it is a standard industry practice designed to mitigate the financial loss from "no-shows" and last-minute cancellations. Revenue management algorithms predict how many guests will fail to arrive based on historical data, allowing the hotel to sell more rooms than they physically have to ensure 100% occupancy. Legally, this is permitted because the "contract" between a guest and a hotel usually includes a clause allowing the hotel to provide alternative accommodations of equal or greater value if a room is unavailable. When a hotel is "oversold," they must "walk" the guest—this means they pay for the guest's first night at a nearby hotel, provide transportation there, and often offer a future stay voucher as an apology. While frustrating for travelers, overbooking is a vital economic tool that keeps base room rates lower for everyone by ensuring the hotel maximizes its most perishable asset: a nightly room stay that can never be sold again once the sun rises.