The old couple on the train said that Pecs was the most beautiful town in Hungary. "It's the light," she said, leaning forward and straightening her long floral skirt, "it's like the Mediterranean."

He, hugging a salami as if it were a baby, pushed his glasses back up his nose and contradicted her. "No, no, it's the people. The people are so happy because they live there. They know they're living in the best place in Hungary." The two proceeded to exchange a series of heated mutters in Hungarian. "Anyway," the salami man said, looking defeated, "it's really beautiful."

Pecs is Hungary's southernmost city, a four-hour train ride due south from Budapest, not far from the Croatian border. It's in a beautiful setting, squeezed up against forested hills on one side, the other end of town blending into vineyards which produce some of the country's best Chardonnay.

It is one of the most culturally enriched cities in Europe: established initially by the Romans, conquered by the Magyars, then seized by the Ottoman Turks and finally settled by Germans 300 years ago. It's also in a forgotten corner - so far south it's largely free of the crowds of German and Austrian tourists who are turning the towns of the Danube Bend and Lake Balaton into a kind of central European Costa Brava.

Everywhere in town, there were girls and women carrying small bunches of flowers. At the Szechenyi Ter, the central square, two young women in matching silk blouses and perfectly white skirts were sitting on a bench, each holding a small bunch of pansies. "We wait for boyfriends," said one, giggling a little and flicking back a lock of chestnut-coloured hair. You're giving them flowers? "Yes, why not? Flowers are beautiful, no?"

I wandered around for five days with an innocent look on my face, thinking this could be the one and only time in my life a woman would give me flowers. But it didn't work.

Because of its southern location, Pecs is considered the "Midi" of this landlocked country, and since the fall of Communism a cafe culture has sprung up. In the Rozskaert, a garden cafe nestling in the shade of lime trees by the imposing cathedral, I had a superb venison goulash, flavoured with fiery paprika, and some glasses of Egre Bikaver, Bull's Blood wine - the only red wine strong enough to match the food.

The central square is dominated by what used to be one of the finest mosques in central Europe, the mosque of Gazi Kassim Pasha, built by the Ottoman Turks in the 16th century. It has since been turned into a Catholic church, but it was plainly a mosque from its domed outline and structure, and is all the more striking for this. The Hungarians generally destroyed all traces of the Ottoman invasion.

The town square tends to leave visitors architecturally bemused. Buildings from the 16th, 17th and 18th centuries are jumbled together. The main cathedral, the Dom, is an imposing, neo-Gothic structure with four huge towers and a remarkable collection of ecclesiastical robes, crucifixes and rings stretching back to the 11th century in its crypt.

The Little Mosque is the only fully preserved Turkish monument in Hungary, its interior contains intricate murals and tapestries, and antique carpets. Pecs is nearer to Istanbul than to Brussels (though the locals won't thank you for telling them this) and here you really feel this. The city has one of the most extreme climates in central Europe: sweltering summers, and winters with winds blowing in off the Steppes of Russia. I had three days of warm sunshine and two days of freezing rain.

The town's wealth of museums provided a more than adequate distraction from the weather. One is dedicated to the artist Victor Vasarely; another, the Zsolnay, is lined with case upon case of antique porcelain, and an archaelogical museum of prehistory in the region. "Prehistory" is deemed to stop with the Magyar conquest in the late 9th century - the Magyars being the ancestors of today's Hungarians.

Moving to more modern times, the Donauschwaben, the Swabians of the Danube, arrived in Pecs 300 years ago. They were skilled farmers sent by the Austro-Hungarian empress, Maria Theresia, to fill the empty spaces left after the Ottoman retreat. There are still almost 200,000 of them, and they produce most of the wine in the rolling hills to the south of Pecs. Because of its isolation, this district is one of the most beautiful wine-growing areas in Europe. Renting a car from Pecs, I spent a day and an evening happily tasting Chardonnay and Riesling in Villany, a little village just south of the town. "Mmm, melons and peaches on the palate," I remarked ponderously. "No, that's Chardonnay, this is Riesling," hissed my companion.

How to get there

British Airways (0345 222111) and the Hungarian airline Malev (0171-439 0577) each fly twice daily between Heathrow and Budapest. The lowest official fare on both airlines is pounds 213.50 including tax, with an extra pounds 10 in either direction for travel on Friday, Saturday or Sunday. Agents can usually undercut these fares: Hamilton Travel (0171-344 3344) has a fare of pounds 165 return on Malev's morning flight. To reach Pecs, the simplest option is the train from Budapest; the journey takes around four hours for a fare of pounds 12.

How to get in

British passport holders no longer require a visa for Hungary.

Where to stay

Darius Sanai paid pounds 20 a night for a single room at the clean and pleasant Hotel Vig Apad, near the station at Martirok utca 14, 7623 Pecs (00 36 72 31 33 40).

Who to ask

The Hungarian National Tourist Office is at PO Box 4336, London SW18 4XE; call a premium-rate number, 0891 171200, for recorded information.