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San Miguel de Allende's The Oasis

With its brightly colored villas filled with antiques, San Miguel de Allende has built a reputation as the quintessential colonial Mexican town—and it’s on its way to becoming a UNESCO World Heritage site in 2008. With this change around the corner, the city is sprucing up its look, and the four-bedroom Oasis is the gold standard. Two years ago, when New York expat Nancy Lane Hooper stumbled upon a collapsed 17th-century ruin downtown, she envisioned a tiny retreat that would introduce a sophisticated fusion of east meets west to San Miguel’s more traditional architecture.

Hooper discovered a glorious mansion hidden under the debris, with original cantera-stone lintels and two-foot-thick walls. To revamp the interiors, she turned to local design firm Mitu Atelier. The result: gleaming circular mirrors in chrome frames hang from leather straps, while ogee arches and ornately patterned pillows are reminiscent of a Turkish harem. Upstairs in four suites (the Nomad, the Bedouin, the Berber, and the Sahara), you'll find massive four-poster beds with 1,000-thread-count sheets, towels as thick as Berber carpets, and thoughtful details like terra-cotta exfoliants in the bathrooms.

The inn’s biggest draw is its rooftop terrace. Overlooking the city’s pastel domes and filigreed spires, it’s an otherworldly setting for a breakfast of traditional chilaquiles (tortillas and cheese drenched in salsa), whipped up by Nellie, the inn’s affable cook. And at night, the skyline view leaves a lasting impression.

1A Chiquitos; 210/745-1457; www.oasissanmiguel.com; doubles from $260.

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