VILLA PEHUENIA is a young, friendly and fast-growing holiday village set amongst araucaria trees, on the shores of pristine Lago Aluminé. Cabañas are the boom industry here, springing up in both the main part of the village and on the lumpy, tree-covered peninsula that juts into the lake's chilly waters. In places, the steep basalt sides of the peninsula make great diving perches if you can tough out the water temperature. To the north is Volcán Batea Mahuida, a mountain that has a minuscule ski-resort.

The Ruca Pehuén mini-supermarket has some of the least expensive accommodation in the village (tel 02942/498024; $60-80), with one quadruple for $40. Camping Lagrimitas (tel 02942/496337; $5 per person plus $1 per tent; one $50 apartment for five people) has some fantastic, tranquil pitches beneath monkey puzzles by the lake shore. On the peninsula, twenty minutes' walk from the main village or reached by Yumbel and Ruca Antú minibuses, you'll find Eyén Lihué on the hill ($48dbl with breakfast). Rooms are snug and peaceful, and snacks are served in the restaurant . A little to the left is Cabañas Caren (tel 155-801227; $60-80), which rents well-designed luxury cabins with a fully equipped kitchen for up to seven people ($130). Its personable owners speak English and Italian. Next door is Hostería Al Paraíso ($70dbl, charged per person), another enjoyable place which serves meals of roast goat and trout ($12).