Imerovigli

Set on the highest point of the caldera's rim, Imerovigli (the name means "watchtower") is quiet, traditional, and less expensive than other places on the caldera. The 25-minute walk from Fira, with incredible views, should be on everyone's itinerary. The lodgings, some of them traditional cave houses, are mostly down stairways from the cliff-side walkway. The big rock backing the village was once crowned by Skaros Castle, whence Venetian overlords reigned after 1207, but it collapsed in an earthquake, leaving only the rock. A trail descending from the church of Ayios Georgios crosses the isthmus and encircles Skaros; it's only 10 minutes to the castle top. After 1 km (½ mile) it reaches the small chapel of Theoskepasti—the one with the blue dome on all the postcards—with a memorable caldera view.