A study by TRI Hospitality Consulting, commissioned by Stockport Council, identified significant scope for more hotels in and around the town centre.
The report found that the market 'can only grow' as the regeneration of the town centre gathers pace.
Publication of the report closely follows a similar study by DTZ into the office market in the town, which also found room for growth and recommended concentrating development in the town centre.
Stockport has come under fire from developers and agents who argue it does not do enough to promote new projects.
In response to this week's report by TRI the council said hotel development is already underway with planning permission recently being granted for a 165-bed hotel development on the King's Reach Business Park, near the pyramid and the M60 motorway.
Travelodge has also signed up to delivering a 114-bed hotel as part of the Targetfollow Grand Central scheme just off the A6.
A number of other sites around the town centre also have planning permission for hotel development, including Heaton Lane, Piccadilly, Hopes Carr, Stockport Village and Water Street.
Norman Hudson, service director for regeneration and leisure, said: "Developing the hotel market is one of our priorities as part of the Town Centre Masterplan. This report confirms the potential that we know Stockport has for this type of development and will help us move forward with our vision. We have the location, transport links, businesses and communications, as well as the ideal sites for a vibrant and successful hotel market."