Tranquil waters lap the shore and mariachi rings through the air in Mexico's historic port.


Legend has it that when the galleons of Hernán Cortés first dropped anchor in the shallows off Manzanillo, sailors saw fairies dancing in the moonlit water. Nearly half a millennium later, visitors are still discovering the allure of this seaside city ringed by an emerald rain forest and twin turquoise bays.

Long a favorite among vacationing Mexicans, Manzanillo defies the common prejudice that a commercial port and a world-class destination resort town can't coexist. Pollution is kept in check by confining terminal operations to the Laguna de San Pedrito, a self-cleansing marshland near the old city center and miles from most hotels. There, white herons and pink flamingos strut as giant orange cranes unload containers from ships that have traveled from as far away as Russia. Meanwhile, out in the bays, scuba divers and snorkelers explore the untouched sea world; along 10 miles of powdery volcanic sand, sun worshipers soak up the rays, turning a blind eye to the machinery of international commerce.

Some 7,000 hotel rooms have been constructed since Manzanillo's first resort hotel, Las Hadas, opened in 1974. Without a cruise ship terminal or a major shopping district, though, the city has never managed to attract the masses like Puerto Vallarta or Acapulco. That may change soon. The state of Colima recently commissioned José Luis Ezquerra, Manzanillo's most celebrated architect, to remodel the city's tired commercial center in the Moorish style of Las Hadas (which he also designed). Plans call for a malecón (pier) lined with boutiques and restaurants, an upscale 300-room hotel, and a cruise ship terminal capable of handling 25,000 passengers a year.

Although ground has yet to be broken for the terminal, the sleepy wharfside plaza, with its gazebos and hibiscus topiary, has already been replanted. All this means that the time to dance in the moonlight on the black and gold sands of the playas is now—before the cruise ships drop anchor and those mythical fairies decide to fandango off to a more deserted shore.

La Toscana (Willy's) 3177 Blvd. Costero Miguel de la Madrid, Santiago; 52-314/333-2515; dinner for two $50. Ask any resident to name the best restaurant in town, and you're sure to be told it's Willy's. What they won't tell you is that the French bistro was destroyed by a rogue wave more than a year ago. Instead of rebuilding, Jean François Laroche elected to round out the menu at La Toscana, his Italian restaurant just up the beach, with a few French favorites from his dearly departed establishment. Now the cuisine at Toscana is mostly French, and everybody just calls it Willy's.

L'Recife Avda. Cerro del Cenicero, Santiago; 52-314/335-0900; dinner for two $60. This month, you can watch the whale migration from a table in the palapa, poised high above Playa L'Recife. Even if the rocky cliffside location weren't so dramatic, the chateaubriand—stuffed with shrimp, wrapped in bacon, and slathered in mango sauce—would be worth the half-hour drive from the Santiago Peninsula. Do as the locals do and bring your swimsuit: diners are invited to take their dessert between dips in the nearby cliff-top pool.

Los Delfines Avda. Vista Hermosa, Santiago Peninsula; 52-314/331-0101; dinner for two $50. Exceptional seafood—most notably the deep-fried whole red snapper—is served in a thatched pavilion that juts into the ocean like the prow of a yacht. Request a table by the water, toss the fish head over the rail, and watch the water churn as angelfish pick it clean.

Hamburguesia Juanito's Blvd. Costero Miguel de la Madrid, km 14, Santiago; 52-314/333-1388; lunch for two $10. Expat John Corey's hideaway acts as Manzanillo's unofficial American Embassy. Here, Yankees watch football on ESPN, check their e-mail, or savor a burger and curiously sweet fries (a result of the high starch content in Mexican potatoes), while speaking in their native tongue.

Restaurante Chantilly 60 Blvd. Francisco Madero, El Centro; 52-314/332-0194; lunch for two $9. Don't let the name or the greasy-spoon ambience fool you: the fare is pure Mexican, the dollar enchiladas are muy auténtico, and the tables are always packed. And since Chantilly is directly across the street from the Palacio Municipal, you just might find yourself sharing a table with Manzanillo's mayor.

Las Hadas Golf Resort & Marina Avda. Vista Hermosa, Santiago Peninsula; 888/559-4329 or 52-314/331-0101;; doubles from $247. Its whitewashed towers and minarets glow in the sun, waterfalls trickle in nooks along cobbled walkways, and bougainvillea blossoms cast shadows in the lagoon-like pool. The 234 guest rooms at Manzanillo's most prestigious resort have marble floors, stucco ceilings, and ocean-view terraces.

Casa Arabia La Punta, Santiago Peninsula; 503/460-2643;; doubles from $550, four-night minimum. You won't find Casa Arabia in any guidebook or, for that matter, in the local phone book. This villa with four guest rooms, in the gated community of La Punta, delivers the ultimate in luxury (including a chef, butler, and concierge) and privacy. No wonder Julia Roberts came here to unwind before last year's Academy Awards.

Kármina Palace 13 Avda. Vista Hermosa, Santiago Peninsula; 877/527-6462 or 52-314/334-1313;; doubles from $215, all-inclusive. Each expansive suite is designed with wall-to-wall marble, a sunken living room, and a bathroom that has a deep tub and a walk-in shower. The only downside to this resort: the restaurant. After 11 p.m., the refined Carioca is transformed into a raucous open-air disco.

Hotel Colonial 100 Avda. México, El Centro; 52-314/332-1080; doubles from $44. Manzanillo's oldest—and probably least expensive—hotel. Constructed around a courtyard restaurant in the heart of the business district, it has three levels of adobe adorned with hand-painted tiles and stained-glass windows.

Pepe's Hideaway
Eccentric gray-haired surfer Pepe Telaraña owns Manzanillo's most unusual inn, an assortment of palapas scattered about a two-acre wedge of jungle. Each of the seven primitive huts on stilts comes with modern amenities: a king-sized bed, electricity, running water, and a sunken tub. There's even a swimming pool, spa, and thatched dining pavilion. Pepe's Hideaway, 52-314/333-0616;; doubles $300, all-inclusive.

Although most visitors are content to simply recline in the powdery sand or soak in the 80-degree ocean, Manzanillo has plenty of pursuits for active outdoor enthusiasts.

Lucky anglers can reel in their own marlin on a sportfishing expedition with Flota Amarilla (52-314/332-1031; five-hour trips from $195) or Ocean Pacific Adventures (52-314/335-0605; five-hour trips from $200).

The water is clear up to 60 feet, and there's plenty to see beneath the waves. Susan Dearing, one of the most experienced dive operators on Mexico's Pacific coast, and the owner of Underworld Scuba (Plaza Pacífico, Santiago; 52-314/333-0642; two-hour snorkeling trips from $38, including gear; three-hour dives from $76), organizes excursions to the best spots. The company also leads half-day hikes ($55, including lunch) to a swimming hole at the base of a 100-foot waterfall and to the cloud forest in the foothills of the Sierra Madre.

Often cited as one of the world's 100 best courses, La Mantarraya (52-314/331-0101, ext. 3702; $96) at Las Hadas is also one of the most challenging.

Manzanillo might not offer much in the way of upscale boutiques, but it does have a resident fashion designer. Paco Silva (Plaza Pacífico, Santiago; 52-314/332-1659) embroiders his couture designs with sequins the way Seurat painted with dots—meaning, the more the better.

To get a feel for the real Manzanillo, spend an afternoon in El Centro, the lively business district. Stall after stall along Avenida México is stocked with baskets of grain, religious statues, kitchen appliances, fabric—every conceivable thing, it seems, except bona fide souvenirs. At the indoor market on Avenida 5 de Mayo (between Guerrero and Cuauhtémoc), tables are piled high with mangoes, limes, papayas, bananas, spices, and layers of fresh snapper and giant shrimp. All of El Centro shuts down at two o'clock—siesta. Those who don't venture to their brightly painted houses in the hills spend the afternoon in the plaza sipping cups of tuba (coconut palm juice sprinkled with peanuts). A keyboard player livens up the Bar Social (across from the main square), a jam-packed 1950's cantina, until 4 p.m., when the city goes back to work.