The dirt road to Arenal Observatory Lodge splits about four kilometers east of the ranger station. One branch leads south along the southern edge of Lake Arenal via the tiny community of El Castillo, beyond which it leads to Rancho Margot and the end of the road.

The El Castillo area is a hit with children and adults alike. With the Butterfly Conservatory and Rancho Margot bordering the Children's Eternal Rainforest Reserve, and aerial tram and zipline tours at Arenal Rainforest Reserve, what's not to love?

The Butterfly Conservancy

The Butterfly Conservancy (tel. 506/2479-1149, www.butterflyconservatory.org, 8 a.m.–5 p.m. daily, $12 adults, $8 students and children under 8) is a butterfly garden and insect museum with live scorpions, rhinoceros beetles, and lizards, among other creatures. About 30 species of butterflies are raised here and flit beneath seven netted arenas (claimed to be the largest in Costa Rica), while others are released to repopulate the wild. It also has a poison-dart-frog exhibit, a botanical garden with medicinal plants, and trails good for viewing monkeys.

Jardín Biológico y Serpientes del Arenal

Next door, Victor Hugo Quesada’s Jardín Biológico y Serpientes del Arenal (tel. 506/8358-6773, 8 a.m.–9 p.m. daily, $12 low season, $15 high season) has an excellent snake exhibit with about 35 species, including pit vipers and fer-de-lance, plus poison-dart frogs, lizards, turtles, and arachnids.

Arenal Ecozoo

Opened in 2010, the Arenal Ecozoo (tel. 506/2479-1059, www.arenalecozoo.com, 8 a.m.–7 p.m. daily, $15 adults, $10 students and children) has hopped on the local bandwagon and offers its own butterfly garden, serpentarium, insectarium, ranarium, and insect exhibits.

Hotels and Restaurants

otel Cabinitas El Castillo (tel./fax 506/8383-7196, from $40 s, $55 d), above El Castillo, has gone a tad more upscale and now offers six spacious rooms in two-story units, in addition to its original 10 cabinas with large picture windows on three sides. There’s a cozy restaurant with sweeping vistas and excellent tilapia.

A boutique backpackers hostel? Well, not quite, but Essence Arenal (tel. 506/2479-1131, www.essencearenal.com, $28–58 s/d), set in 22 hectares of forested grounds one kilometer south of El Castillo, is a chic place blending traditional Costa Rica furnishings in a dramatic contemporary design. A huge hearth keeps things warm in the lounge, and there’s a TV room, pool, free Internet, and movie nights. It has double, triple, and quad rooms, all with orthopedic mattresses. Chef Isaac Weliver prepares gourmet vegetarian dishes.

Hotel Linda Vista del Norte (tel. 506/2479-1551, U.S. tel. 866/546-4239, www.hotellindavista.com, from $57 s, $66 d low season; from $66 s, $76 high season), east of El Castillo, enjoys a splendid hilltop position with views of both lake and volcano. It adjoins a 210-hectare private forest reserve with trails. Like many hotels here, it keeps expanding and added a lovely stone-walled horizon-edge pool. Choose from modestly furnished yet attractive cabins, or 11 standard rooms with two full-size beds and a bunk bed. Two junior suites have two queen beds, air-conditioning, and mini-refrigerator, plus there are now spacious suites with glass walls that open onto roomy verandas with great volcano views. The colorful restaurant also has picture-perfect views. Guided horseback tours are offered. Rates include taxes and breakfast.

The Arenal Vista Lodge (tel. 506/2479-1802, www.arenalvistalodge.com, $70 s, $82 d low season; $76 s, $88 d high season), west of El Castillo, perches on a landscaped terraced hill with a private forest reserve behind. Once drab, decor in the 28 cabins has been enlivened, and vast picture windows feature window boxes and small balconies with lake views. A dining room and terrace offer panoramas. It has a swimming pool and sundeck.

For intimacy, opt for former Pan Am air hostess Ellen Neely’s lovely Hummingbird Nest B&B (tel. 506/8835-8711, www.hummingbirdnestbb.com, $40 s, 75 d includes tax and breakfast), set in hilltop gardens. You get fabulous volcano views through picture windows in its two guest rooms; bathrooms are a bit small, though. All have ceiling fans, mini-fridges, and homey decor such as frilly pillows. It has a patio whirlpool tub. A solid bargain!

Rancho Margot (tel. 506/8302-7318, www.ranchomargot.org, $55 s, $85 d bunkhouse, $118 s, $159 d bungalows) has bunks in basic yet super-clean and well-thought-out dorm rooms with shared bathrooms. There are 18 lovely bungalows at the forest edge, nicely furnished and boasting terra-cotta floors, whitewashed walls, modern bathrooms, and spacious decks. Prices include breakfast, tax, tour, yoga, and some activities. The Sunday buffet (tel. 506/479-7259) draws locals from far and wide—no wonder, as a professional chef attends to the kitchen.

Go for pizza or just a laugh from John DaVita, a former L.A. punk rocker who runs Pizza John’s Jardín Escondido (tel. 506/2479-1155, noon–9 p.m. daily), tucked away off the road to Rancho Margot; keep an eye out for the sign. John loves to tell outrageous tales, but also cooks up a mean pizza and delicious homemade ice cream. Add your graffiti to the scrawl left by a zillion other visitors.