Filled with vestiges of its colonial past—cobblestone streets, enchanting squares, and deserted convents—Antigua, one of Latin America's loveliest cities, instantly transports you back hundreds of years to when the Spanish ruled this land. The city lost out on its role as colonial capital in the late 18th century, and yet with the reverence shown here to the past, you may think Antigüeños don't realize that era is over. No matter, La Antigua Guatemala ("the old Guatemala")—to use the city's official name—likely relishes its role as the capital of Guatemalan tourism far more.

At the height of its power, Antigua was home to 60,000 people and ruled Spanish Central America. Its enormous wealth was poured into the construction of churches, monasteries, convents, palaces, and mansions. Then came 1773: A massive earthquake damaged or destroyed some 3,000 of the city's structures, necessitating the move of the capital to what would become present-day Guatemala City. The poverty of the few who stayed behind meant over a century of stagnation and no funds to rebuild. Eventually, money did begin to flow back into the local economy, thanks to the lucrative coffee trade. Antigua's foundation of colonial architecture remained, and residents had no interest in tearing down the city's proud heritage. Power lines went underground, truck traffic was rerouted out of the city, and signage was greatly reduced. (McDonald's, Burger King, and Subway are all here, but you have to look hard to find them.) An active National Council for the Protection of Antigua Guatemala imposes stringent guidelines on the restoration of buildings, maintaining the colonial character of Antigua. History once dealt the city a severe blow, and yet without it, Antigua might today be—perish the thought—Guatemala City.

Antigua's mountainside community of about 35,000 people is vastly more pleasant than the capital. At a 1,530-meter (5,019-foot) altitude, its comfortable climate lives up to that oft-repeated boast that Guatemala is the land of eternal spring. Prices do tilt slightly higher here than in the rest of Guatemala, but walking and soaking up the atmosphere, Antigua's quintessential entertainment, are always free. An ever-increasing influx of visitors and expat retirees has brought in some of the country's finest hotels and restaurants, a collection of boutiques and galleries, and several dozen Spanish-language schools that attract students from all over the world. Yet as one member of the protection council once told us, Antigua was never created to be some vast indoor/outdoor museum. Increased tourism has been a nice side benefit, but the city's magnificent colonial architecture serves workaday purposes as hotels, restaurants, stores, homes, schools, barber shops, hardware stores, and everything in between.