Despite its modest size, Otavalo (pop. 43,000) hosts the biggest textiles market in Ecuador and one of the most famous in South America. The market is a permanent fixture in the Plaza de Ponchos, but every Saturday the stalls spread out across the town, and thousands of locals and visitors mix it up in a festival of buying, selling, and haggling.

The unique local indigenous group, the Otavaleños, dominate the town, and much of the local population is dedicated to making and selling textiles, handicrafts, jewelry, and ceramics. Their textiles and indigenous music are carried around the world.

There is so much to buy that shopaholics may consider leaving a trip to Otavalo until the end of their Ecuador visit to avoid dragging their purchases around the rest of the country.

Otavalo is not just about shopping, however, and there’s plenty to keep you occupied in the vicinity. The setting of the town is very attractive, nestled at 2,530 meters in the verdant Valle del Amanecer (Valley of the Sunrise) between two dormant volcanoes: Cotacachi to the northwest and Imbabura to the east. Both peaks offer climbing opportunities, and there is great hiking around several stunning lakes close to town.

Otavalo is one of the oldest towns in Imbabura Province and was a market town long before the Incas arrived. After the Spanish conquest, exploitation of the local craftspeople pervaded, and they were forced to work in sweatshops in terrible conditions. Independence did little to improve matters with the equally oppressive huasipungo system, in which indigenous people labored in exchange for access to tiny farm plots.

In the 19th century, mass production switched to factories, but handmade products remained popular. It wasn’t until 1964 that the exploitation was outlawed by the Agrarian Reform Law and indigenous people were given land and control over their choice of work. Since then, textiles have become the product of choice, earning the Otavaleños global fame and quality of life that is worlds apart from most other indigenous groups in South America.

It’s easy to see that there is wealth here, with the younger generation driving shiny new 4WD vehicles blasting contemporary music in the streets in the early evening. The indigenous heritage is still dominant in Otavalo, however, and locals wear their distinctive hats, ponchos, embroidered shirts, and blouses with pride.

Sadly, the large number of visitors has led to occasional robberies, although far less frequently than in Quito. Never leave your hotel room unlocked, and be careful of bag-slashers and pickpockets in the crowded Saturday market. You should also be careful on the bus between Otavalo and Quito. When exploring the area’s trails and more remote locations, it’s better to travel in groups or on guide-led tours because lone hikers have occasionally been robbed. On the whole, however, the streets of Otavalo are safe at night.

Textile Market

The town’s biggest draw, and the reason you probably can’t find a hotel room on Friday night, is the Saturday textile market. Vendors from town and surrounding villages set up shop well before dawn. By 8 a.m. the animal market is under way, and soon the Plaza de Ponchos is packed with a brightly colored, murmuring throng of vendors and visitors haggling over every imaginable type of textile and craft.

The market has become so successful that it is now open daily, and there’s a wider choice of wares any day of the week than in other market towns. The Saturday market is still the biggest, though, and it’s worth experiencing the hustle and bustle even if you don’t intend to buy anything.

Anything made out of wool, cotton, or synthetic yarn can be found here in all shapes and sizes, including for infants. Clothing is the most popular buy: Thick wool and alpaca sweaters keep out the cold and come in interesting patterns; pajama-style thin cotton trousers come in every color imaginable; embroidered shirts, blouses, skirts, and wool mittens are popular; and rather less traditional is a huge range of T-shirts with Ecuadorian-themed designs.

Carpets and blankets are often covered in llama designs, and wall hangings, woven with abstract patterns, are popular. The traditional hats made of felt or wool are another good buy as well as handbags and cloud-soft alpaca teddy bears.

The best (and most expensive) ponchos, worn by the Otavaleños themselves, are made of thick wool dyed blue with indigo imported from abroad, and with a collar and gray or plaid fabric on the inside. Other ponchos are made of synthetic materials like Orlon, which is less expensive but brighter.

Long cloth strips called fajas, used by indígenas in the Sierra to tie back their hair, hang next to their wider cousins called chumbis. Many of these belts are woven in La Compañía, on the other side of Lago San Pablo. A single belt woven on a traditional backstrap loom (stretched between a post and the waist of the seated weaver) can take as long as four days to complete.

Jewelry similar to that worn by indigenous women is spread out on tables: necklaces of black or red beads interspersed with earrings of turquoise and lapis lazuli. Other treasures include raw fleece, yarn, and dyes, textiles from Peru and Bolivia, painted balsa-wood birds, and even novelty shrunken heads (fake, of course).

For the Saturday market, it’s best to spend Friday night in town, but make a reservation because hotels fill up fast. Alternately, get up early Saturday morning to take the bus from Quito. Bargaining is expected, even in the many stores in town, and foreigners are naturally offered rather inflated prices, so haggle away, but don’t be too pushy; if you get 30 percent off the starting price, you’re doing well. Prices peak when the tour buses from Quito are in town, usually 9 a.m.–noon, so either shop very early or linger late for the best deals.

For a very different market experience, get up early and visit the animal market, held on Saturday morning starting at sunrise. Everything from cows, piglets, guinea pigs, puppies, and kittens (not for eating, thankfully) are for sale here. It’s an animal rights campaigner’s nightmare, and you’re unlikely to make a purchase, but it’s an interesting experience nevertheless. To get here, head west on Morales or Calderón and cross the bridge, passing the stadium. The market is straight ahead across the Panamericana.

Getting to Otavalo

Otavalo’s bus terminal (Atahualpa and Ordoñez) is on the northeast corner of town, where you can catch buses to Quito (2 hours, $2.50) and Ibarra (40 minutes, $0.40) every 15 minutes, as well as to nearby villages such as Ilumán, Carabuela, Peguche, and Agato. You can also catch any bus heading north along the Panamericana and ask the driver to let you off at the appropriate intersection, then walk. Coming back is even easier—just flag down any bus heading south.

Taxis, which congregate at the bus terminal, plazas, and parks, charge about $1 for short journeys around town, $3 for attractions on the edge of town (Peguche waterfalls and El Lechero are two examples), and from $10 per hour for more out-of-the-way locations like Lagunas de Mojanda.