Last month The New York Times travel section , in its inimitably Eurocentric manner, pointed out how hostels have become an increasingly viable option for anyone who wants to travel overseas on a budget - but without having to hassle with snorers and other nuisances in a dorm with a dozen bunks. It’s true that traveling in the Southern Cone countries is generally cheaper than Europe but, in any event, hostels in Argentina, Chile and Uruguay often are better options than higher-priced one, two, or even three-star hotels (it’s worth adding that “star categories” here are less meaningful than they might be in Europe).
Many Southern Cone hostels belong to Hostelling International  (especially in Argentina), but others (especially in Chile) are independents, sometimes loosely organized affiliates that do not require membership (non-members pay slightly higher prices at HI hostels). In addition to private rooms, often very stylish, they even have amenities that would have been unthinkable even a few years ago - Puerto Iguazú’s Hostel Inn Iguazú , for instance, has an enormous outdoor swimming pool ideal for cooling off after an excursion to the subtropical heat and humidity of Parque Nacional Iguazú  and its thundering falls. It sister hostel, the Marcopolo Inn Náutico , occupies a site in the Río Paraná delta, so secluded that it’s hard to believe it’s barely an hour from Buenos Aires  (which has many fine hostels in its own right), and offers kayaks for its guests.
The trendsetter among Chile’s independent hostels is Pucón’s Hostería ¡Ecole! , which opened in 1994, but many others have followed its example. My personal favorite is Talca’s Casa Chueca , which also conducts tours into some of the most scenic, and undervisited, parts of the Chilean Andes. Santiago’s La Casa Roja  is, to my knowledge, the only hostel in the Southern Cone with a swimup bar and a batting cage (suitable for cricket or baseball).
Patagonia, especially on the Argentine side, has abundant hostels that are remarkably stylish, such as El Calafate’s Hostel del Glaciar Libertador  and América del Sur Hostel . In the shadow of Cerro Fitz Roy, El Chaltén’s Albergue Patagonia  (pictured above) has recently added some of the most beautifully simple rooms in Patagonia's "trekking capital."
For some of the best options in Chile, check the websites of Backpackers Best  and Backpackers Chile , both of which are misleadingly named - almost all of them will meet the expectations of surprisingly demanding guests. In Argentina, try the national affiliate of Hostelling International  and, across the Río de la Plata, Hostelling Uruguay .