2 Best Hotels in Palacio, Madrid

In an unbeatable location across from Monasterio de las Descalzas Reales, this hotel—once the U.S. embassy and later a luxurious residential building crowded with noblemen—has the architectural bones of a turn-of-the-century mansion with its hand-carved ceilings, marble foyers, and intricate iron balconies. While the modern streamlined rooms are not exactly design-magazine material, they meet all your practical needs with good mattresses and plenty of storage space.

In the city center, steps from the Palacio Real and Teatro Real, Mario is small with limited services but provides a welcome alternative to Madrid's traditional hotel options at a good price. It has a bold quirky style: original silk-print headboards highlight the white, gray, and black color scheme.