This cut-price ski resort doesn't skimp on quality

'This had better be good." My husband had passed the gritted-teeth stage and was into full snarling mode. We had been sitting in a makeshift car park for an hour and a half, waiting to pass through a single-lane tunnel from Switzerland to Italy.

So were 100 other cars, impatient to get to Livigno, Italy's most remote and cheapest ski resort. "It'll be like a stag night in Prague," my husband continued. "If it's that cheap, you can imagine how horrible it could be."

After driving for six hours, and paying a €25 (£22) toll for the world's most annoying tunnel, I was in no mood to be optimistic either. Thanks to a historical quirk, Livigno, in the Valtellina valley near the Swiss border by St Moritz, is duty free.

This instantly slashes 20 per cent off the cost of most things – from cigarettes (€21 per carton) and booze (4.5 litres of whisky for €46) to restaurant meals and ski lift passes and equipment. We could all do with a bargain right now, but I was also worried the place might be a bit tacky, unredeemed by its high altitude (1,800-3,000m), Alpine location and great snow record.

Finally, we arrived in the town just after dusk. I could see fairy lights sparkling in the snow, and the slanted Alpine roofs were covered in a fresh foot of the white stuff. We were just in time for the passeggiata on the Via Plan, the attractive pedestrianised town centre. It was a scene worthy of our tedious effort.

Soon we were tucking into big plates of pasta at the lively yet cosy Albergo Bivio. The hearty local speciality, pizzocheri, made of buckwheat pasta with potatoes, cabbage and taleggio cheese, was just the thing on a cold night. Two courses, aperitifs, wine and coffees came to €56, our most expensive meal of the week. If this was to be a credit-crunch ski break, we'd have to cut back, with the euro roughly equal to the pound.

The Hotel Alpina in the town centre put us up in its new apartments on Via Teola, perched on a hill about a 15-minute walk away. It's a bit of a climb, but the reward is a broad view of the village and two of Livigno's four ski areas. We could easily see what the conditions were and which were open. Among its 115km of runs, Livigno has excellent beginner and intermediate pistes, most of which are perfect for long cruising runs, and its snow park is regarded as the best in Italy. It doesn't have many black runs, however, but as I'm only a low-intermediate skier and my husband is a beginner snowboarder, this suited us fine.

Our young instructors Dmitri and Hansel gave us an entertaining introduction to the slopes, their enthusiasm for their hometown infectious. Soon we were on long red runs that gave us sweeping views of the mountains and the valley below. Most pistes are the wide motorway runs that keep timid skiers like me happy, but there are a few that wind their way through the woods and offer more of a challenge.

Snow was falling gently, but that didn't stop us from eating lunch outside. Two meals at La Grolla near the ski school cost €23, which became the average for lunch and dinner. I had visited an inexpensive French Alpine resort only weeks before, and Livigno won hands down on the food and drink front. The nightlife was better too, with plenty of après-ski bars in town as well as on the mountain.

And, unlike many resorts in Italy where the lift systems leave a lot to be desired, Livigno is constantly improving itself. This is largely because the ski areas are owned by rival families, and competition is fierce. If one side brings in a heated chair lift, the other side responds with a new cable car. The skier is the ultimate winner, because the lift pass covers the entire valley. This resort may be a budget-beater, but its facilities certainly aren't bargain basement.

Compact facts

How to get there

Mary Novakovich travelled with Inghams (020-8780 4444; inghams.co.uk), which offers seven nights' half-board at the Hotel Alpina from £738 per person, including return Gatwick flights to Brescia and transfers. A Ski Saver Pack costs from £175 per person, which includes a six-day lift pass, equipment hire and three days' tuition. Carrentals (carrentals.co.uk) offers seven-day car rental from £85.

Further information

Livigno tourism (livigno.eu).