Estelí ’s festival season is clearly December, when practically the whole month there is some sort of activity including the famous Hípica (horse parade) and Purisima celebrating the Virgin Mary with free take-aways at every house.
Estelí has quite an eclectic nightlife considering it is far from any beaches or larger cities. It has a little something for everyone from dive bars, mixed local and foreign crowd scenes, salsa, and live music.
The Rincón Legal (200 meters south of the Hospital San Juan de Dios, near El Chaman) is the brainchild of Frankie Legall and is a bar-shrine to the FSLN and Cuban Communist Party; Carlos Mejía Godoy plays here when in town, and this is the home turf of many artists—and a place for wandering lefties to toast the light arms and photos of Carlos Fonseca on the wall.
El Punto de Encuentro (40 meters west of the northwest corner of the central park) features a mellow hangout in the hidden patio/garden for enjoying cheap eats and drinks.
In the same area you will also find the very popular, Rancho Bar El Semáforo which is perfect for large groups and especially lively on Saturday; when its two large dance floors attract a mixed crowd.
Just before Semáforo is El Chaiman, also large with a thatched roof and a jungle motif, with live music every once in a while and definitely more of a local crowd. For good local live music and great food try Ixcoteli Bar and Restaurant or Friday nights at Mocha Nana Café. To just sit back and catch up on conversation, go to Habana Sports Bar. Take a taxi to the south side of town and spend an evening just walking from one to the other.
For dancing, Axis Discoteca on the Pan-American Highway towards the center of town has a spacious dance floor and a party that lasts well past midnight. But a newer and hipper place is The Cave Club (adjacent to Whitehouse Pizza near the cathedral, tel. 505/2713-2116) with three levels of bar and a truly cavelike basement disco that really thumps.
Karaoke is as popular as ever in Nicaragua and Estelí  keeps pace. La Confianza (from Payless, 1.5 blocks north) is the place to be for beers, talking, and catching interesting regulars. The atmosphere allows for talking but also boasts lots of space and karoke.
Be Lounge has karaoke during the week but the weekends are usually crowded with the younger Estelíanos. Las Vegas is often a late-night stop, open until 6 a.m. with a small dance floor that alternates from karaoke to disco music in a black-light room of Las Vegas kitsch.