Why do we say `five star hotel’ and not `five stars hotel’?

This is because `star’ is functioning as an adjective, and not as a noun. You can say that you saw `Five stars shining in the sky.’ But when a noun like hotel follows the word `star’, you say, `I had dinner in a three star hotel’. You do not say, `three stars hotel’. Similarly, you say, `I want five rupees’. But when the word `rupees’ is followed by the noun `coin’ or `note’, you say, `I need a five rupee coin/note’. You do not say, `five rupees note’. Joggers talk about a `twenty-mile marathon’, and not a `twenty miles marathon’.