Before I moved to Lisbon, almost a quarter of a century ago, someone told me: “From afar, it looks like a queen. But from closer you see that the old empress’s make-up is smudged and flaking, and that the ornaments fluttering in the wind are not lace, but someone’s laundry drying at the windows. But she’s still is a real beauty.”

I fell in love with Lisbon from the off. The city has since been seriously spruced up and redeveloped, but it hasn’t lost its shabby-chic glamour. It’s a very user-friendly city: not too big, not too small, safe, and not too expensive. Even today, 20 years later, it still manages to surprise me with its beauty and luminosity.

Terreiro do Paço

Praça do Comércio is a large square flanked by elegant buildings, with one side open to the river Tagus, or Tejo in Portuguese. Lisboans still call it by its old name, Terreiro do Paço, or Palace Courtyard. It was the emblematic centre of the Portuguese empire, where kings lived, and precious spices and colonial goods were traded for gold. In 1755, Lisbon was hit by a huge earthquake, followed by a fire and a tsunami, which almost destroyed it in a day. The square in its present incarnation rose from the rubble of that disaster. It was also here that, in 1974, a military coup turned into a popular democracy movement, with red carnations in the barrels of the soldiers’ rifles. It is a good starting point for exploring Lisbon on hop-on-hop-off double-decker buses.

Bistro 100 Maneiras

This is a story of unforeseen success. The owner, Ljubomir Stanisic, born in Sarajevo, fled the war to Portugal as a boy. Now he is a celebrity chef, with books, his own TV programme, and restaurants that are the height of fashion. Bistro 100 Maneiras, a two-floor restaurant in an art deco mansion in the busy Bairro Alto district, is perfect for high-end dining: squid, octopus, rack of lamb. The space is elegant yet informal, there’s a refined selection of cocktails and the best Portuguese wines, and each dish is a wonderful surprise. You can dine here for €40 a head.
• Largo da Trindade 9, 100maneiras.com, open Sun–Sat 7pm–2am

Miradouro da Graça

Lisbon’s climate means that, with a bit of luck, we can be outdoors all year round. The city’s miradouros, or viewpoints, are perfect spots to hang out. Miradouro da Graça is my favourite. On a terrace high above Lisbon’s patchwork of tiled roofs, in the shadow of pine trees, you can enjoy the breeze while sipping a coffee or cold beer. Downtown, the medieval castle, the red suspension bridge, the river, and the statue of Christ, arms wide open overlooking the estuary, all fit into a single fascinating picture, and it’s especially photogenic at sunset.

The city on seven hills also offers many other panoramic views. Santa Catarina, Senhora do Monte, Monte Agudo … Any place called a miradouro is an excellent place to chill. And pay attention to the sky: here it is two tones closer to indigo than the regular sky blue. You will be surprised by the whiteness of clouds against that blue.
• Calçada da Graça

Casa Independente

Intendente is the most diverse and multicultural area in Portugal. Once a druggy red light district, it has been taken over by hipsters, immigrants and artists. Intendente square proper is encircled by historic buildings – some restored, some not – and small bars serving petiscos (similar to tapas) at pavement tables. It is a lovely, friendly place to linger from morning till late at night, over a small draft beer (€2).

Inside the 17th-century palace that dominates the square is Casa Independente Cultural Association, founded five years ago. It’s a wonderful alternative space, with high-ceilinged lounges, scruffy back garden and enormous ballroom. I like its relaxed atmosphere, petiscos, and eclectic cultural and musical programme.
• casaindependente.com, Largo do Intendente 45

Take the tram to the Thieves’ Market

Do a classic Lisbon city-safari by taking the number 28 tram, which passes through the popular districts of Graça, Alfama, Baixa and Estrela. The trams are small, like wardrobes on wheels, to pass through the narrow streets of the oldest quarters. For many years, on Saturday mornings, I have been taking the 28 through the labyrinth of Alfama to Feira da Ladra, or Thieves’ Market. It is an open-air flea market overlooking the river: picturesque, colourful, swarming with people, yet surprisingly calm, where you can stroll, buy trinkets (cash only), and have lunch. It’s full of amazing things, from authentic antiques to authentic trash.
• Campo de Santa Clara, Tue & Sat, 9am–2pm

‘Typical’ restaurants

Portuguese cuisine is simple and honest. The fish is fresh from the ocean, the steaks juicy, the wine full-bodied. Lisbon’s old-school restaurantes tipicos, are easy to recognise, with meat and fish on ice, and paper tablecloths. My three favourites have become so popular I have to book, or even queue. They’re all in the same neighbourhood, so if I don’t get a table in one, I try another.

For the most exquisite grilled cod or octopus in green olive oil, go to Cova Funda, just off Intendente square; for the freshest shellfish, there’s Marisqueira Lis, just across the avenue; and for a charcoal grill, the Carvoaria Jacto steakhouse, two blocks away (the owner is a butcher, so he knows his meat). Whichever you choose, you’ll wine and dine well for under €20.

Take a walking tour

For several years now, a group of young people calling themselves the Lisbon Walkers have been taking locals and tourists on guided walking tour. It’s a lovely way to experience Lisbon. For beginners, there is a general tour, but things get more exciting when you choose to see Lisbon district by district. There are also special interest tours: medieval, African, Jewish, freemason, literary or underground Lisbon. My favourite tour is on legends and mysteries: two hours learning about Ulysses as the founder of Lisbon, the young martyrs of Lisbon and St Vincent and the ravens, for €15.
• Daily tours in English start from the meeting point in Terreiro do Paço, lisbonwalker.com

National Coach Museum

The collection of royal vehicles at the Museu Nacional dos Coches in Belem transports you back in time. The oldest vehicle, from 1619, brought Philip III of Spain to Lisbon to take over the throne; the last to be used drove a young Queen Elizabeth II to visit the Portuguese dictator Antonio Salazar in 1957. A trio of opulent coaches were made in 1716 and sent to Rome by the richest of all the kings of Portugal, João V “the Pious”, to show to the Pope how devout he was and how prosperous his empire. For a taste of Lisbon at the height of the inquisition, I recommend the novel Baltasar and Blimunda, by the Portuguese Nobel prize laureate José Saramago. It’s a story of love, miracles and flying machines.
• Avenida da Índia 136, €8, closed Monday

Lisbon Oceanarium

Oceanário de Lisboa is perfect for a rainy day. It’s home to water creatures of all kinds, shapes and sizes: colourful anemones and corals, sea-stars, fluorescent jellyfish, dragonfish, exotic frogs, penguins and playful sea otters. In the massive circular central glass tank swim large fish, such as sunfish, manta rays and sharks. It is in the hyper-modern Parque das Nações, the suburb built from scratch on the waterfront for Expo 1998, by the futuristic Gare do Oriente station.
• Open 10am–7pm, adult 16,20, child €10.80, buy tickets online to avoid queueing

Estoril

Thirty minutes west of the city, the seaside resort of Estoril, with its Grand Casino, was founded in 1935 – for the amusement of Lisbon’s rich. At the beginning of the second world war, Lisbon was an important escape route from Europe, and nearby Estoril unexpectedly became an international destination for refugees. Its Hotel Palácio sheltered the likes of Salvador Dalí, Antoine du Saint-Exupéry, Ian Fleming, and the Duke and of Windsor and Wallis Simpson. As well as a lot of spies.

After the war the resort became a haven for exiled monarchs and dictators, who used to meet in the Palácio for Sunday lunch. Later, it became popular among celebrities, including Orson Welles, Gina Lollobrigida, Sophia Loren, Luchino Visconti and Zsa Zsa Gabor. Rooms in the Palácio, which is as elegant and pompous as ever, still carry their names. Some years ago, it was reported that restoration work in the hotel had uncovered kilometres of wiring left over from war espionage.

Today, Estoril is a quiet, wealthy seaside town with subtropical vegetation, golf courses and sandy beaches. It’s ideal for a day trip.
• Trains from Lisbon’s Cais do Sodré station depart every 30 minutes, €2.25 one way

Dejan Tiago-Stanković’s debut novel, Estoril is published by Head of Zeus, £12.99. To buy a copy for £11.04 with free UK p&p, go to guardianbookshop.com

Way to go

Flights
Easyjet and Ryanair fly to Lisbon from several UK cities from £82 return.

Where to stay
In a classic early 20th-century building with tiled facade and wrought iron balcony, B&B Casa Amora (doubles from €115) is named after a Portuguese artist and has a sunny patio for breakfast or afternoon drinks.

Best time to go
April-May and September-October: prices are lower but weather can still be beach-friendly.

Exchange rate
£1 = €1.15
A small beer in a neighbourhood bar costs from €1.80, a coffee about €1.