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The heart of Old Madrid is this vast square, surrounded by arcaded buildings, now home to tourist shops (see Plaza Mayor).

You can easily lose a day wandering around the quirky stalls of the city’s flea market and watching the bustling world go by in the many bars and cafés (see El Rastro).

This historic square off Calle Mayor has been the centre of local government since medieval times. Opposite the Casa de la Villa, is the Casa y Torre de los Lujanes, Madrid’s oldest civil building (15th-century). In the centre of the square is a statue of Alvaro de Bazán, the Spanish admiral who defeated the Turks at Lepanto in 1571 (see Golden Age). Erected in the late 19th century, it is by sculptor Mariano Benlliure. The palace on the south side is the Casa de Cisneros (1537), built for one of Spain’s most powerful families.

The museum is housed in an attractive 16th-century palace which once belonged to the Counts of Paredes. The original Renaissance courtyard is best viewed from the first floor where archaeological finds from the Madrid region are exhibited, including a beautiful Roman mosaic floor from the 4th century AD. Among the highlights downstairs are wooden models of the city and its royal palaces as they would have appeared in the 17th century, a short film bringing to life Francisco Ricci’s painting of the 1680 auto-de-fé (see Plaza Mayor) and the San Isidro chapel built near the spot where the saint is said to have died.

Legend has it that this magnificent basílica occupies the site of a monastery founded by St Francis of Assisi in the 13th century. Work on the present building was completed in 1784 under the supervision of Francesco Sabatini. The focal point of the unusual circular design is the stupendous dome, 58 m (190 ft) high and 33 m (110 ft) in diameter. After 30 years of painstaking restoration, the 19th-century ceiling frescos, painted by leading artists of the day, are now revealed in their original glory. Take the guided tour to be shown other artistic treasures, which include paintings by artists Zurbarán and Goya (chapel of San Bernardino) and the Gothic choir.

This colourful working-class neighbourhood has a cosmopolitan feel, thanks to its ethnic mix of Moroccans, Indians, Turks and Chinese. The narrow streets sloping towards the river from Plaza Tirso de Molina are full of shops selling everything from cheap clothes and leather handbags to tea and spices. Check out the traditional bars, such as Taberna Antonio Sánchez for example. Performances of the traditional light opera known as zarzuela are given outdoors in La Corrala in summer.

Lavapiés district

Historic La Latina really comes alive on Sundays when the trendy bars of Cava Baja, Calle de Don Pedro and Plaza de los Carros are frequented by pop singers, actors and TV stars. Plaza de la Paja – the main square of medieval Madrid – takes its name from the straw which was sold here by villagers from the across the River Manzanares. Nowadays it’s much quieter and a nice place to rest one’s legs. The two churches of San Andrés and San Pedro el Viejo have been closed for some time but their history and that of the area as a whole is admirably explained in the Museo de San Isidro (see La Latina).

The greatest dramatist of Spain’s Golden Age lived in this roomy, two-storey brick house from 1610 until his death in 1635. Lope de Vega started writing at the age of 12 and his amazing tally of 1,500 plays (not counting poetry, novels and devotional works) has never been beaten. He became a priest after the death of his second wife in 1614, but that didn’t stop his compulsive philandering which led to more than one run-in with the law. To tour the restored house with its heavy wooden shutters, creaking staircases and beamed ceilings, is to step back in time. You get to see the author’s bedroom, and the book-lined study where he wrote many of his plays. The women of the house gathered in the adjoining embroidery room – the heavy wall-hangings were to keep out the cold. Other evocative details include a cloak, sword and belt discarded by one of Lope’s friends in the guest bedroom.

The streets around this well-known square boast the greatest concentration of tapas bars in the city and it’s often still buzzing at 4am. A plaque outside Hotel Reina Victoria honours the great bullfighter, Manolete, a regular guest until he was killed in the ring in 1947.

For hundreds of years Madrid’s town council met in the church of San Salvador (since demolished) but in 1644 it was decided to give them a new, permanent home. The Town Hall was completed 50 years later. Its main features – an austere brick and granite façade, steepled towers and ornamental portals – are typical of the architectural style favoured by the Hapsburgs. Juan de Villanueva added the balcony overlooking Calle Mayor so that Queen María Luisa could watch the annual Corpus Christi procession. Highlights of the tour include the gala staircase, hung with tapestries designed by Rubens; the reception hall with its painted ceiling and chandelier; the 16th-century silver monstrance carried in the Corpus Christi procession; the courtyard with stained-glass ceiling; and the debating chamber with frescoes by Antonio Palomino.