Under a brutally bright sun, Nashville's alternative music community is sipping cocktails on the roof of the Icon Building in The Gulch, a former warehouse district increasingly populated by sleek high-rises and buzzing restaurants. Pant-suited Americana singers, drainpipe-jeaned punks and flannel-shirted indie rockers are gathered to celebrate the Next Big Nashville, an annual event designed to highlight the wealth and variety of bands in a place that, despite being labelled Music City USA, is renowned for country music and little else.

To outsiders their presence is probably unexpected. Nashville is best known for squeaky-clean residents like Dolly Parton, Reba McEntire and Miley Cyrus (daughter of Billy Ray Cyrus, aka Hannah Montana) and honky-tonk bars and barbecue shacks. But the city, like its skyline, is changing. It is attracting celebrities from beyond its former cultural reach, with the White Stripes' Jack White moving here, cult director Harmony Korine returning to his former hometown, Nicole Kidman settling down with husband Keith Urban and Robert Plant recording the Grammy Award-winning album Raising Sand with bluegrass artist Alison Krauss. Formerly down-at-heel neighbourhoods are being revitalised, new restaurants and bars open weekly, and the city's country music heritage is finally competing for attention with the likes of pop rockers Paramore and 2009 Brit and NME award-winners Kings of Leon.

This burgeoning scene may be cool but the city's unpretentious lifestyle and warm southern welcome mean it is also very accessible, making Nashville one of America's most attractive destinations for those seeking an alternative to the homogenous mall culture of most of its big cities.

Music

While honky-tonk bars remain popular down on Broadway, and Music Row continues to shelter an industry largely focused on country and Christian acts, elsewhere a vibrant alternative scene is emerging. Next Big Nashville's annual festivities (nextbignashville.net) provide an opportunity to catch many local favourites, from the pop-punk of the Privates to the Dynamites' retro-soul, while clubs such as The End (2219 Elliston Place) - a run-down, dark and beery space with a fondness for punk rock - and The Exit/In (2208 Elliston Place, exitin.com), the larger and smarter venue, showcase native and out-of-town talent year long. If it's established acts you're searching for, the Ryman Auditorium (116 Fifth Avenue North, ryman.com) is the place to go. To catch emerging talent, keep an eye out for MySpace bulletins and leaflets in local record stores. These leak information about the city's booming house party scene, centred around local label Infinity Cat's leading acts Jeff and MeeMaw, with the latter regularly hosting chaotic shows in the basement of their home.

Best music shop in town

London has the Rough Trade Shop, New York has Other Music, but Nashville presents stiff competition with one of the world's best independent record shops, Grimey's (1604 8th Avenue South, grimeys.com). Co-owner Mike Grimes established his hipster credentials with the Slow Bar in the then no-go area of East Nashville in the 90s, but when the previous site of his record shop proved too small, and rising rents - arguably, initiated by the success of his enterprises - forced him out, he upped sticks and opened a shop just south of downtown, where he also started booking shows in The Basement below. His determination to offer alternatives to mainstream country ensures the store, staffed mainly by local musicians, offers an enviable selection of underground sounds alongside a sizeable assortment of "pre-loved" CDs and LPs. The staff will also recommend and provide tickets for the best shows downstairs. Such is the reputation of both the store and the club beneath that, after signing records upstairs, Metallica performed an intimate show in June last year for just 150 fans.

Bars

The Family Wash (2038 Greenwood Avenue, familywash.com), an intimate bar, restaurant and venue in East Nashville, was built using material from a launderette that formerly occupied the land. The speciality, shepherd's pie, is eaten at small tables clustered in front of a tiny stage that showcases local musical talent. The Red Door Saloon (1816 Division Street, thereddoorsaloon.com) is a more rowdy affair with a traditional roadhouse bar vibe, favoured during the week by studio workers from nearby Music Row checking out the sports results on TVs over the bar and at the weekend by younger city residents letting their hair down. But the Springwater Supper Club (115 27th Avenue North, springwatersupperclub.com), a former speakeasy frequented through the years by Willie Nelson, Townes Van Zandt and these days by the many members of local musical heroes Lambchop, remains the most popular indie-rock hangout. Harmony Korine even chose its dive bar surroundings as the location for the recent Budweiser adverts featuring eccentric regular Dave Cloud.

Restaurants

Despite its retro leanings, Nashville is not afraid of the modern. In the once sleepy neighbourhoods of East Nashville, a burgeoning drinking and dining scene has sprung up, centred around the Five Points crossroads where Jack White's favourite restaurant, Marché Artisan Foods (1000 Main Street, marcheartisanfoods.com), stands across a car park from Gillian Welch's Woodland Recording Studios. Also offering specialist grocery and delicatessen items, Marché concentrates on freshly prepared Mediterranean-inspired cuisine served in a light and airy dining area. Welch has herself been lured out of recording sessions by nearby Rumours East's (1112 Woodland St, rumourswinebar.com/east) impressive wine list, beautifully presented food (including plenty of fish) and spacious patio. Those looking for something a little less pricey, however, can take advantage of the city's multicultural riches. A third of Nashville's citizens are non-white, including America's largest Kurdish population, which means there's a wide choice of international cuisine, with increasingly popular Ethiopian establishments alongside plenty of Japanese and Italian. Mexican food is hardest to beat - La Hacienda (2615 Nolensville Road, lahaciendainc.com) was first and remains justifiably packed - but City House's (1222 4th Avenue North, cityhousenashville.com) contemporary Italian also attracts high praise, with Robert Plant among its regulars.

Cafes

A thriving independent cafe culture means you're never far from a good coffee. Especially favoured is Nashville's original coffeehouse Bongo Java (2007 Belmont Blvd, bongojava.com), winner of local paper Nashville Scene's Best Coffeehouse Award from 1994-2007 (it dropped to second place in 2008 behind its sister cafe Fido) and creator of the internationally famous Nunbun, a cinnamon bun that looks like Mother Theresa. They also roast their own coffee. Newly opened Crema (15 Hermitage Avenue, crema-coffee.com) is arguably the most adventurous establishment, offering concoctions such as Café Tom Kai (a blend of coconut milk, Kaffir lime syrup and espresso), but Portland Brew's (2605 12th Avenue South, portlandbrewcoffee.com) deliberately sparse and indie-rocker-friendly premises is the place to rub shoulders with the likes of Jack White's Raconteurs.

Boutiques

Mainstream Nashville fashion may have changed little since Dolly Parton worked 9 to 5, but a number of local boutiques have set out to combine retro themes with a contemporary twist. 12th Avenue South houses a variety, from the mildly hippy Serendipity (2301 12th Avenue South, serendipity12th.com) to Local Honey's (1207 Linden Avenue, localhoneynashville.blogspot.com) vintage threads. But Two Elle (2309 12th Avenue South, twoelle.com), a cosy store established in a grey clapboard house set back from the street, is the most cutting edge, stocking affordable designer clothes sourced from across the US alongside vintage sunglasses, jewellery and chocolate. It specialises in the informal but chic look favoured by those too hip for Urban Outfitters, and its liberal credentials were confirmed by a 10% discount for anyone registering to vote in last year's presidential election while at the store.

Galleries

The community spirit isn't restricted to music: on the first Saturday evening of every month, galleries in the 105-year-old Arcade (224 5th Avenue North) - a short line dance from Broadway's honky-tonk and bluegrass bars - open their doors for the free Art Crawl. Around 1,000 people visit the Twist Art Gallery (twistartgallery.com) and The Showroom for a mix of contemporary installations, painting, sculpture and photography. Crowds spill across Fifth Avenue to visit The Arts Company (215 5th Avenue North, theartscompany.com), one of the downtown district's most enduring visual art spaces, along with newcomers like the Rymer Gallery (233 5th Avenue North, therymergallery.com) and Tinney Contemporary (237 5th Avenue North, tinneycontemporary.com). The Frist Center For The Visual Arts (919 Broadway, fristcenter.org) provides a more mainstream approach while presenting some of the city's most ambitious visual art programming. Recent exhibitions have featured everything from Rodin to the modern artists of the Société Anonyme and the stunning large-format photography of contemporary Australian artist Rosemary Laing.

• Flights to Nashville from Heathrow start at £373 inc taxes through Trailfinders (0845 050 5892, trailfinders.com). Doubles at Hotel Indigo (001 615 329 4200, ichotelsgroup.com) from around $99 per night plus tax. The Next Big Nashville (nextbignashville.net) is on 7-11 October.

· This article was amended on Monday March 2 2009. Robert Plant and Alison Krauss' Grammy Award-winning album was called Raising Sand, not Please Read the Letter. This has been corrected.