Budapest is one of Central Europe's gayest cities. And in more ways than one. As Communist relics harden into cold museum pieces, the Hungarian capital's dazzling cosmopolitan past--preserved in stone and gilded in gold--is heating up like never before.

Cracked, soot-covered cherubs climb the facade of a huge blackened building, reaching toward trees that shoot out of decrepit turrets. It's not a public building, so though my guidebook identifies it as the once grand Gresham Palace, I move on.

That was in 1991. Recently, I looked up at those same cherubs, now scrubbed and fresh-faced, then walked through the doorman-attended portico of the Gresham. Greeting me were a gorgeous mosaic floor, a dramatic glass ceiling, towering wrought-iron gates, and a bustling bistro. This onetime symbol of a city in disrepair has been transformed into a stunning Four Seasons hotel.

The story of this building is oddly parallel to that of Budapest: once a cultural hub, bombed mercilessly during World War II, left to wither under Soviet oppression, and now emerging yet again as a cosmopolitan center. Though no one will mistake it for Berlin, Budapest is moving forward-rebuilding, opening its doors more to capitalism and gay culture, and spinning it all in a uniquely Hungarian way. Putting its own stamp on outside influences is something the city has been doing for centuries. And nowhere is that clearer than in its architecture. In fact, so many different styles exist that most design is referred to simply as "eclectic."

Look at Budapest from high on Gellert Hill and it's practically a paean to religion--a city of churches and spires, neatly bisected by the not-so-blue anymore Danube. The two sides, Buda and (you guessed it) Pest, were founded as separate towns but merged in 1873. Today, Buda is full of parks, hills, and old monuments, while Pest is the center of gay culture, shops, outdoor cards, and hip restaurants.

Yet the two sides are connected by more than a few bridges and a metro system (the first in continental Europe). The entire city--and country--are trying to shake off the Soviet doldrums. "After political changes" is how locals talk about post-Soviet rule, and some 15 years after those changes, East German-manufactured Wartburg vehicles and blocky utilitarian buildings still stand as signs of a bland 40 years. But now those cars sit next to shiny new VWs, and those dour buildings stand next to Jaguar dealerships.

This mix of disparate elements is very much a part of Hungarian culture. After all, since the 1st century this area has been ruled in turn by Romans, Magyars, Mongols, Turks, Austrians, and Soviets, all of whom have left their marks. In that sense the Gresham--built in 1906 to house the British-run Gresham Life Assurance Company--is the quintessential Budapest building: Its outsize iron gates are typical Hungarian art nouveau, lovebirds in the railings nod toward Hungarian folk art, stained glass windows line the hallways, spectacular rounded glass ceilings infuse the lobby with fight and majesty.

Yet modernity is also everywhere. The original asphalt floor--chic in 1906--has been replaced with Italian mosaics. Work from contemporary Hungarian artists fills the public spaces. A gorgeous modern Czech chandelier hangs over the front desk. And the brand-new spa is housed on a brand-new floor.

"Other Europeans can use history in a modern way," says Aron Gabor, the lead architect on the hotel restoration, "but that doesn't happen in Hungary because of the Soviet oppression. To use the past we have to go back before that time, to places like the Gresham. And there's not as much of that past preserved as we'd like."

Indeed, fully 80% of Budapest was leveled by WWII bombs. And that wasn't the first time the city had been reduced to ashes: The Mongols had destroyed it centuries earlier. Any classic buildings standing today are either recreations or rare survivors. The mix is best seen in Buda's Castle District, where you'll see a number of Gothic, Baroque, and Renaissance buildings towering above the ubiquitous utilitarian Soviet "panel houses."

Earthquakes, attacks, fire, and war have besieged this area, yet at its center still stands gorgeous Matthias Church, a fitting study in architectural melding. The original 13th-century Gothic church saw the addition of a 14th-century stone gate, flamboyant touches added during the Renaissance, and whitewashing by 16th-century Turks, who used it as a mosque. Pieces of all these elements remain, along with an interior of richly colored wall designs, original stained glass, floral patterns of Hungarian art nouveau, and a 19th century roof that explodes in color.

That multidesign, multiuse history can also be seen at Buda Castle--its repeatedly destroyed and rebuilt exterior now has a modern interior and acts as a museum. This is not to say that a more straightforward history makes a building less beautiful: Parliament, for example, erupts in a flurry Of spires, like skinny models standing sentry on its domes. And the 1884 neo-Renaissance Opera House-gilded and ornate, with marble figures and gorgeous oak carvings-has been the perfect setting for many live performances, as well as for scenes in Alan Parker's Evita.

Some things in Budapest, however, aren't as obvious as the huge buildings--gay life, for example. "It's still pretty underground," one Hungarian guy told me at Action, a gay bar. In fact, Action was so hard to find that my cabby, address in hand, drove past it three times. A small "A" and an even smaller pride flag on the door were the only signs that there were strippers and dark corners within. Once inside, though, more than one guy asked if I would meet him at the Kiraly baths.

Baths are an essential part of Budapest's gay and straight life, and ones like Rudas, Rac, and Kiraly figure in the city's architectural heritage. The Romans built the first baths, taking advantage of the underground thermal waters, and the Turks added to that legacy. Rac was closed and awaiting renovation when I visited, although Rudas recently got a major makeover. Kiraly was open, and its policy restricting admission to specific genders on alternating days makes it a natural gay hangout. The 16th-century octagonal bath is the main attraction, covered by an ancient dome with tiny pinholes that allow threads of light through, offering just enough visibility for cruising--albeit with a crusty old man keeping an eye on things.

Budapest's other baths don't have a gay vibe at all, but they're gorgeous places for a soak. The Szechenyi baths in City Park were built in a palatial Hapsburg style, with outdoor pools surrounded by regal buildings. Naked men and women (statues) line the walls, while the city's young and beautiful fie around sunning themselves. And the Gellert Hotel houses perhaps the most Hungarian of all the baths: ornate and serious, a place where Evelyn Waugh and Queen Juliana of Holland took the thermal waters. There you'll find a grand entrance, stone and wrought-iron balconies, stained-glass ceilings, huge columns, and mosaic floors. Its gorgeous main pool is one of the finest examples of art nouveau in Europe, though sadly the adjoining hotel is in dire need of repair.

Locals feel that someone will eventually come in and restore the Gellert to its former glory, following the lead of Hilton, who started the trend of hotel chains preserving Budapest's past with their Castle District hotel, built around the ruins of a 13th-century Dominican monastery. Hilton excavated and preserved what was left in 1976, and today the glass hotel faces off against stray sections of ancient brick. The Four Seasons restoration of the Gresham came later, and hotel companies are now eyeing the historic building across the street from the Opera House for an upscale property.

Other hotel companies are taking a different tack: The Kempinski is a modern interpretation of palace architecture. And the Andrassy is a Bauhaus-style building decked out with red fights, water, and stone accents. It's a natural draw for hipsters, who sat playing iTunes on their PowerBooks when I visited.

Hilton, Kempinski, Four Seasons: Foreign investment is key to Budapest's progress. Many modern glass structures are going up on Vaci Street, across from a similarly crystalline mall adorned with Volvo and Nike logos. And just down the street from the Andrassy Hotel is Budapest's most forward-looking building. Thin lines of marble and g]ass appear jumbled together and stacked, the 10 dramatically angled sections crisscrossed with polished steel rods that weave and twist like a roller coaster, at once stretching the building and tying it together. The building's occupant: Dutch insurance conglomerate ING.

Foreigners are helping to breathe fife into the city's gay scene too. It's not uncommon to find Americans, Parisians, and Germans on the dance floors of the gay discos. This melding of cultures and styles--along with the movement toward more openness in both--is what 21st-century Budapest is all about. "We definitely see more modern ideas coming down the pike," says architect fitron Gabor. "But we still have to build shopping malls, office space, modern housing. Before we can move forward, we have to catch up."

Budapest Essentials

(Dial 011 before all numbers for international calls) ACCOMMODATIONS The Four Seasons Hotel (Roosevelt Ter 5-6, 1051, 36-1-268-6000) is by far the most luxurious hotel in Budapest and a shining example of restored Hungarian history. Andrassy Hotel (Andrassy utca 111, 36-1-462-2100) is Budapest's hippest hotel, and it's close to the Opera House and City Park. For gay-owned accommodations, check into the KM Saga Guest Residence (Lonyai utca 17, 36-30-932-3334), located in an art nouveau building that's decked out with 19th-century antiques.

RESTAURANTS Pava, at the Four Seasons, boasts an innovative contemporary Italian menu and amazing views across the Danube. Amstel River Cafe (Parizsi utca 6, 36-1-266-4334) is a casual gay-owned cafe in the heart of the city, near the Danube. And Tom George (Oktober 6 utca 8, 36-1-266-3525) is one of Budapest's hippest restaurants, a contemporary space with retro touches and, more important, excellent seafood and steak. BARS Gay bars here often have minimums, usually around $7, the cost of three beers. Boldly named Coxx (Dohany utca 38, 36-1-344-4884) has a nice brick-lined bar with significant square footage devoted to themed play spaces (jail cell, anyone?). Action (Magyar utca 42, 36-1-266-9148) has a tiny stage and a large cruising area. Angyal (Szovetseg utca 33, 36-1-351-6490) is a happening dance club with the occasional transvestite show.

LESBIAN SCENE Lesbian-owned Cafe Eklektika (Semmelweis utca 21, 36-1-266-3054) hums with a passion reminiscent of American lesbian coffeehouses of the 1970s. The retro furniture includes 1960s airplane seats. While friendly to customers of any persuasion, Cafe Eklektika is definitely the center of lesbian life in Budapest. Cafe Vis Major (Szent Istvan krt. 2, 36-1-239-4451) is LGBT-friendly, and Barcsak Bar (Izabella utca 85) hosts a biweekly lesbian gathering called Barcsak Rendezvous. If you're looking to mingle, Osztrosokk is a lesbian party held the last Saturday of each month in the Living Room (Kossuth Lajos utca 17, 36-1-266-1925), and Milkshake is a monthly party for lesbians and their friends at Jailhouse Club (Tuzolto utca 22, 36-30-989-4905). Lesbian-friendly cellar wine bar Kopia Cafe (Zichy Jeno utca 4, 36-30-9999-981) is a stunning space, with rounded stone walls, white tile floors, and the occasional lesbian photo exhibit, it represents what is so exciting about Budapest: freshness, lack of cynicism, and a bright attentiveness to art and music.--Lucy Jane Bledsoe

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