Everyone ends up at the Top Spot Food Court, a cheap hawker center venue on Jalan Bukit Mata off Jalan Tunku Abdul Rahman just near the Holiday Inn. Various stalls cook Chinese, Malay, and Western food, all sorts of exotic dishes, and local and seafood dishes. Located on the roof of a multistory parking garage, don't expect anything but "local charm" for decor. But the food is good and cheap and you'll bump into plenty of other travelers and locals here to chat with.
A good pick for local specialties is the Dulit Coffee House at Telang Usan Hotel (tel. 082/415-588). Try their local Sarawak version of laksa, vermicelli noodles and seafood in a rich and spicy coconut gravy, or the Sarawak black pepper steak, which is a house specialty. Entrees are reasonably priced between RM8 and RM24 ($2.25-$6.75/£1.10-£3.35).