Panarea is the second smallest of the islands but has some of the most dramatic scenery, including wild caves carved out of the rock and dazzling flora. The exceptionally clear water and the richness of life on the sea floor make Panarea especially suitable for underwater exploration, though there's little in the way of beaches. The outlying rocks and islets make a gorgeous sight, and you can enjoy the panorama on an easy excursion to the small Bronze Age village at Capo Milazzese.

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