Concierge.com's insider take:
Madrid is a wonderful walking city. You'll doubtless find yourself, sooner or later, along the Paseo del Prado, in Plaza Mayor, and in Puerta del Sol. Stop for a quick look, but don't sit at any of the overpriced cafés in these areas, where you'll be serenaded by patronizing Spanish guitarists, condescended to by uppity waiters with tuxedos and A.D.D., and generally made to feel like a fanny-packed loser.
The key to seeing Madrid is, instead, to escape from these places and explore the neighborhoods, where the changing nature of the city is more palpable. First and foremost, this means Chueca, long known as the city's gay neighborhood but now also housing the hippest restaurants, nightspots, and boutiques—most among streets and buildings that only a few years ago were ready to be condemned. Las Letras, the rapidly gentrifying old literary district, is also fascinating, and by night on weekends, Malasaña is a scene of throbbing street culture that has to be seen to be believed.
Another way to walk the city is by art gallery–hopping. Chueca and the Lavapiés neighborhood are where the new galleries and foundations are clustering. Check out the Galería Travesía Cuatro (4 Travesía de San Mateo; 34-91-310-0098; www.travesiacuatro.com), the Fundación Juan March (77 Calle Castelló; 34-91-435-4240; www.march.es), and the Círculo de Bellas Artes (42 Calle de Alcalá; 34-91-360-5400; www.circulodebellasartes.es).