In this paper, we present the development and demonstration of a polymer electrolyte membrane (PEM) fuel-cell-battery hybrid system for the propulsion of a 20-m-long tourist boat. The PEM fuel-cell-battery hybrid system was developed by integrating PEM fuel cells with Li-ion batteries to supply electric power to the waterjet propulsion system and auxiliary equipment of the boat, which was operated in coastal waters. The PEM fuel cells and Li-ion batteries generated an electric power of 50 kW and stored an energy of 47 kWh, respectively. All of the system components, including the PEM fuel-cell modules, hydrogen storage tanks, DC–DC converters, Li-ion battery packs, and battery charger were newly developed and pre-tested for installation onboard, and the boat was built using an aluminum alloy to arrange the developed PEM fuel-cell-battery hybrid system inside of it. The first fuel-cell-powered boat in Korea was successfully demonstrated in the coastal waters of Busan, Korea. The demonstration exhibited the reliable operation of the fuel-cell-battery hybrid system and boat speeds of 6.6–7.8 knots at a power output of ∼85 kW. Display omitted •A PEM fuel-cell-battery hybrid system is developed for a tourist boat.•The system, together with Li-ion batteries, generates a power of 90 kW.•A 20-m-long boat is built for arranging the system.•The fuel-cell-powered boat is demonstrated in coastal waters.•Boat speeds of 6.6–7.8 knots are achieved at a power output of ∼85 kW.