- Barranco: Technically a suburb of Lima and not a proper small town, Barranco feels like an independent village, worlds removed from the chaotic capital city. Overlooking the sea, this most bohemian part of Lima has great old architecture, cool bars and restaurants, and a relaxed, artsy vibe.
- Ayacucho: A pristine colonial gem of a small city nestled in the Central Highlands, Ayacucho, until the mid-1990s, was prisoner to a homegrown guerrilla movement that precluded almost all visitors from being able to relish its collection of stunning colonial-era churches. Ayacucho feels like a small town, at least outside of its Easter and Carnaval celebrations, and is also ground zero for Peru's best handicrafts—the best place in the country to pick up treasures direct from artisans.
- Pisac: The first of the Sacred Valley settlements outside Cusco, Pisac has a great colorful and lively artisans' market and some of the most splendid Inca ruins this side of Machu Picchu. A massive fortress complex clings to a cliff high above town, affording sensational views of the valley.
- Chinchero: Just beyond Cusco, but not technically part of the Sacred Valley, Chinchero is best known for its bustling Sunday artisans' market, one of the best in Peru. But the graceful, traditional Andean town, higher even than Cusco, has mesmerizing views of snowy mountain ranges, a lovely colonial church, and its own Inca ruins. In the pretty main square, you can still see the huge stones and 10 trapezoidal niches of an Inca wall, originally part of a royal palace.
- Ollantaytambo: One of the principal villages of the Sacred Valley of the Incas, "Ollanta" (as the locals call it) is a spectacularly beautiful place along the Urubamba River; the gorge is lined by agricultural terraces, and snowcapped peaks rise in the distance. The ruins of a formidable temple-fortress overlook the old town, a perfect grid of streets built by the Incas, the only such layout remaining in Peru.
- Colca Valley Villages: Chivay, on the edge of Colca Canyon, is the valley's main town, but it isn't much more than a laid-back market town with fantastic hot springs on its outskirts. Dotting the Colca Valley and its extraordinary agricultural terracing are 14 charming colonial villages dating to the 16th century, each marked by a centerpiece church. Yanque, Coporaque, Maca, and Lari are among the most attractive towns, but these villages are best appreciated for their adherence to tradition. Natives in the valley are descendants of the pre-Inca ethnic communities Collaguas and Cabanas, and they maintain the vibrant style of traditional dress, highlighted by fantastically embroidered and sequined hats.
- Cajamarca: A mini-Cusco in the northern highlands, delightful Cajamarca surprisingly doesn't get much tourist traffic—yet. Beautifully framed by the Andes and sumptuous green countryside, with a historic core of colonial buildings where an important Inca city once stood, Cajamarca—a city with the feel of a small town—is elegant and easygoing. It's also very well positioned for day trips into the country and to fascinating archaeological sites; indeed, several of Peru's nicest and most relaxing country hotels are located here.
- Máncora: A funky little town, long popular with surfing addicts and hippie travelers who passed through and never left, Máncora, sandwiched between Peru's beautiful Pacific coast and the amazingly arid desert of the north, is now gaining a reputation for more than its waves and bars. New hotels and restaurants are luring a whole new breed of traveler.
Note: This information was accurate when it was published, but can change without notice. Please be sure to confirm all rates and details directly with the companies in question before planning your trip.