The next morning, I am relieved to view from my hotel window a scene that could have dated to the 1970s or 1980s: sampans putt-putting across the brown waters of the back harbor, and in the small square just outside, groups of Chinese ladies doing tai chi, Chinese dance routines, and bizarre private workouts, oblivious to anyone who might be watching.

I am in the midst of old China. At the end of the cobblestoned square, I turn onto a lane of shophouses. Several elderly folks in black cloth shoes are slurping porridge at a tiny noodle shop on the corner, furnished with two card tables and folding stools. Porridge goes for $1.50; fried noodles, 50 cents. It's the kind of traditional scene that has virtually disappeared in high-tech Hong Kong—even in mainland China's cities, for that matter, which are now obsessed with consumption and money. Off an alley lined with red-doored houses and swooping tiled rooftops, I stumble upon a tiny crimson temple surrounded by tenement buildings, laundry hanging from bamboo poles above. A peasant woman in a straw hat with black cloth hanging round her face is sweeping the quiet street. The two-story houses along the alley are shabby, but they have elegant balconies with arched French windows opening onto them. I can see Buddhist shrines in the back of every house—piles of oranges set before altars lit by red bulbs. A stroll down a narrow road and I am in Portugal—except that all of the people are Chinese. Senado Square, the heart of colonial Macau, whose fountain and cobblestoned plaza, decorated in a swirling black-and-white mosaic, is blocked off for pedestrian traffic. Along with five other spots in Macau, this plaza was declared a World Heritage Site in 2005. Up the hill, I duck into the pale-yellow seventeenth-century Church of St. Dominic, where fans are whirring alongside forbidding Baroque confessional booths. Chandeliers dangle from thirty-five-foot chains. Catholicism is on the wane here, but a handful of Filipino and Chinese women are praying.

From a distance, Macau isn't especially beautiful; it looks like a sprawling town of shanties and tenements. But up close the city's charms reveal themselves. The Chinese carvings and characters above a doorway, neon-pink bougainvillea peeking out from a mildewed wall, Portuguese street signs, the many pastel churches, the ancient Buddhist temples, and the winding lanes give it an otherworldly, peaceful sensibility. There is no place else on earth where you can find this: old China with a fading patina of old Portugal.

On my first night, I wander over to Stanley Ho's Hotel Lisboa. Although the original and first casino has gotten a face-lift, it's little changed in spirit. Instead of the Russian girls in heavy blue eye shadow who used to sit in the coffee shops waiting to be picked up, the prostitutes now patrolling the basement lobby in pairs are dolled-up girls from northern China. Upstairs, the casino seems untouched too: Elderly ladies hunch over baccarat tables under swirls of cigarette smoke. "I don't know why we Chinese love to gamble so much," my cab driver says on the way over. "You foreigners gamble for fun; we gamble until we've lost it all."