If you're in this little town on a summer's day, you'll know why it's called "God's Home." Tiny cross-timbered houses in bright colors flank the cobblestone streets. The fig and mulberry trees, plus the steep slopes, give it a vaguely Mediterranean feeling. Boats clog the harbor, and for lunch you go for the alder-smoked golden herring from one of the local smokehouses -- and the day is yours.
From Østerlars, drive 3km (1 3/4 miles) north, following the signs to Gudhjem, a steeply inclined town that traded with the Hanseatic League during the Middle Ages. Most of its population died as a result of plagues in 1653 and 1654, but Danish guerrilla fighters and sympathizers, following territorial wars with Sweden, repopulated the town some years later.
Before setting out to explore the area, you might want to call first at the Gudhjem Turistbureau, Åbogade 9 (tel. 56-48-52-10; www.gudhjem.nu), a block inland from the harbor. It's open only in summertime, May to September. May to mid-June, and mid-August to September, hours are Monday to Saturday 9am to 3pm. During the peak of midsummer, from mid-June to mid-August, hours are Friday to Wednesday 10am to 3pm.