For nighttime entertainment, be sure to check the calendar of events at the Instituto Michoacano de Cultura. In addition, you can sit at one of the cafes under the stone arches across from the Plaza de Armas to do some people-watching (a very Moreliano thing to do). Aside from the dance clubs that are mostly on the fashionable east side, there are few nightlife options. The following are my favorites. For dancing, go to La Casa de la Salsa (tel. 443/313-9362), a large dance hall facing Plaza Morelos at the end of the Calzada Fray Antonio de San Miguel. It's open Tuesday through Saturday from 9pm to 3am. It books live music on Friday and Saturday ($4/£2 cover). You can call ahead to reserve a table; the band plays a lot of salsa, merengue, and mambo.
If you want to hear live Latin American folk music, have a drink, and eat something, try Peña Colibrí (tel. 443/312-2261), Galeana 36, behind the Virrey de Mendoza. It opens daily at 8pm and closes around midnight. There is another nearby peña (bar where folk music is played) at Allende 3, Bohemia V (no phone). The food isn't good, but the music is great.
