13 Best Christmas Towns in the World That Feel Like a Holiday Fairy Tale

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In December, the best Christmas towns in the world turn into winter wonderlands that offer travelers an escape from reality and a magical vacation bursting at the seams with bright lights, towering trees, fairytale Christmas markets, and more. While visiting big cities like New York, Paris, and London for Christmas can be tempting, the lesser-visited destinations take the crown.

In places like Rye in the United Kingdom and Rothenburg ob der Tauber in Germany, you’ll find a better atmosphere, fewer crowds, and local traditions that can’t be topped. Here are 12 of the best towns in the world for Christmas that offer Christmas markets, festive events, and small-town charm to show you what you’re missing.

Rye, United Kingdom

12 Beautiful Medieval Cities and Towns in the UK Rye — © Rolf / Adobe Stock

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I’m from the United Kingdom, so you might call me biased, but I firmly believe Rye, a beautiful medieval town in East Sussex, England, is one of the world’s best Christmas towns. Oozing British elegance, Rye is a stunning place to visit year-round, but it truly comes to life around Christmas when the town hosts its annual Rye Christmas Festival.

During the festival, Rye is decorated in festive decorations, craft stalls fill the streets, live musical performances take place across the town, and Santa Claus moves into his grotto. Besides the exciting Christmas festivities and holiday spirit, including a Christmas market, Rye has many cultural things to see, including the Rye Castle Museum, Mermaid Street, and the Rye Heritage Museum.

Leavenworth, Washington, United States

12 Best Christmas Towns in the World Leavenworth, Washington, USA — © Jamie and Judy Wild-Danita Delimont / Adobe Stock

Leavenworth, a small Bavarian-style town in the heart of the Cascade Mountains in Washington, is one of the world’s best Christmas towns you can visit if you want to experience the German Alps during the holiday season without leaving America. This small but spectacular town is famed for its Bavarian architecture, traditions, beer, and, most importantly, Christmas.

At Christmas, this picturesque town offers festive cheer in abundance. You can expect Christmas lights, decorations, parties, shows, and more. Of course, Leavenworth also hosts an epic Christmas market with arts and crafts stalls and food and beverage stalls. Make sure you buy a German beer and a bratwurst. Notable attractions and events include the Village of Lights, the Holiday Concert, and the Nutcracker Museum.

Hershey, Pennsylvania, United States

European-Style Christmas Markets in the US Union Square Holiday Market, New York, New York — © Dmitry Naumov / Adobe Stock

Hershey, a small town in Pennsylvania, was put on the map by the Hershey Chocolate company, which plays a significant role in the town’s annual Christmas celebrations. These celebrations feature Christmas markets, light displays, and plenty of chocolate. Hershey may not be the most famous town in the world to spend Christmas, but it’s undoubtedly one of the best.

An excellent Christmas destination for families, you can spend your Christmas in Hershey, meeting Santa Claus, petting reindeer, riding coasters, eating festive treats, and buying last-minute presents for your family. It’s also worth noting that you can stay at Hershey Lodge, the Hotel Hershey, and Hersheypark Camping Resort if you want to stay in the festive spirit for longer.

Selfoss, Iceland

Outdoor enthusiasts who’d prefer to spend their Christmas exploring the great outdoors, watching the Northern Lights, and participating in local traditions should visit Selfoss, a small town in southern Iceland on the banks of the Ölfusá River. Admittedly, the Christmas celebrations in Selfoss aren’t as epic as other towns, but you’ll easily be able to explore Iceland’s spectacular scenery.

That said, the town is still decorated with bright lights and Christmas trees, and locals still celebrate a light switch-on. If you want to get more in the Christmas spirit, you can quickly drive to Reykjavik, where you’ll find a vibrant Christmas market, shopping streets, and Christmas-themed parties. Must-visit attractions near Selfoss include Selfoss Waterfall, Kerid Crater, Skyrland, and Thingvellir National Park.

Niseko, Japan

Niseko, a scenic town located in the Shiribeshi Subprefecture of Hokkaido, Japan, is one of the best Christmas towns in the world for a white Christmas. Thousands of tourists descend on the town every December to experience its breathtaking surroundings, outdoor activities, and festive events. December also marks the start of the ski season in Niseko, so buckle up.

Besides the extraordinary scenery and snowy skies, Niseko is a big hit at Christmas because it hosts several events and activities. Offering something for every kind of traveler, popular things to do include Santa Claus meet-and-greets, attending weekly fireworks displays, participating in the Torch Light Display, having a drink in an ice bar, and going dog sledding. Sounds like fun, right?

Hallstatt, Austria

Hallstatt is an excellent town to visit at Christmas if you’re searching for a combination of natural beauty, tradition, and exciting Christmas activities. This picturesque Alpine town in Austria’s Salzkammergut region sits on the Western shore of Lake Hallst

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Meanwhile, the town center is jam-packed with breathtaking traditional architecture that beckons exploration. You’ll likely spend your time in Hallstatt wandering the narrow streets, walking along the lake, and photographing the magnificent scenery. However, you’ll also want to allow time to explore the traditional Christmas market, sample festive cuisine, and admire the beautiful decorations that cover the town.

Banff, Canada

Banff is best known for its outstanding natural landscapes, towering snow-capped peaks, lush forests, and turquoise lakes, but the town also has much to offer at Christmas, including a beautiful Christmas market that captures the magic, tradition, romance, and heritage of a European Christmas in the heart of the Rocky Mountains.

At the Banff Christmas Market, you can look for a special gift for someone you love, tuck into tasty festive-themed cuisine, listen to live entertainment, and relax at an outdoor fire lounge. Children can meet Santa Claus and participate in exciting events and activities at Santa’s House and Workshop. That’s not it, as the town hosts various other festive events, such as the Santa Claus Celebration of Lights and In Search of Christmas Spirit.

Celerina, Switzerland

In Celerina, travelers can explore a winter wonderland that features skiing slopes, Christmas markets, and snow-covered mountains. Celerina is a small town in southeast Switzerland near St. Moritz. Situated in Engadin, the town is renowned for its impressive natural scenery, but the Christmas market will likely steal your heart.

When you’re not hiking or skiing, make the most of the festive ambiance at the market. Explore the lovingly decorated stalls, sample local delicacies, and meet Santa Claus himself. Once you’ve eaten your body weight in food and bought gifts for friends and family, take the gondola lift from the center of town up into the mountains or visit Ruina Chastlatsch and Reformierte Kirche San Gian.

Oban, United Kingdom

Oban, a coastal town in Scotland’s Argyll and Bute region, makes this list of the best Christmas towns in the world because it offers travelers an excellent combination of outdoor adventure, Scottish tradition, and Christmas fun. In Oban, you’ll spend your Christmas vacation meandering through the Christmas market, listening to live music, and having fun at the Oban Winter Festival.

This exciting festival features a Santa’s Grotto, firework displays, food markets, a Christmas market, and live music performances. Meanwhile, the town is beautifully decorated with bright lights, festive decorations, and Christmas trees. What more could we ask for? Oh, wait, Oban also has a gorgeous stretch of coastline to explore, traditional British pubs, and a beautiful harbor.

Colmar, France

In Colmar’s historic town center, the combination of arts and crafts stalls, food markets, Christmas decorations, and vibrant traditional architecture will put you in the mood for Christmas. A spellbinding place to spend Christmas, this gorgeous town in northeast France is what fairytale Christmases are made of.

Colmar’s medieval cobblestone streets are lined with several Christmas markets bursting at the seams with festive cheer every year. You’ll spend your days sipping mulled wine, shopping until your heart’s content, trying local cuisine, and admiring the breathtaking architecture. After you’ve explored the markets, enjoy a romantic stroll along the Lauch River and visit popular attractions like La Petite Venise and Collégiale Saint-Martin de Colmar.

Woodstock, Vermont, United States

12 Best Christmas Towns in the World Woodstock, Vermont, USA — © spiritofamerica / Adobe Stock

Woodstock, a picturesque town in Vermont, United States, has everything you need to have an epic Christmas vacation. For starters, this gorgeous town has magnificent scenery, a rich history, and breathtaking architecture that serve as the perfect setting for the festive season. If you’re lucky, it might even snow during your holiday.

Second, Woodstock knows how to celebrate Christmas. Between late November and New Year’s Day, you’ll find many exciting Christmas-related things to see and do in Woodstock, including the Woodstock Christmas at the Farm, Wassail Weekend, and Woodstock Christmas Market. Once you’ve had your fill of Christmas cheer, visit iconic attractions like Billings Farm & Museum, Middle Covered Bridge, and Woodstock Town Hall Theatre.

Rothenburg ob der Tauber, Germany

In Rothenburg ob der Tauber, you can enter your favorite fairytale storybook, surrounding yourself with breathtaking medieval architecture and spectacular Christmas decorations. Better yet, you can explore one of Germany’s oldest Christmas markets. These things make this Northern Bavarian town one of the world’s best towns for Christmas.

At every corner of Rothenburg od der Tauber, visitors will stumble upon beautiful, narrow, cobblestone streets with quaint shops and cafes adorned with vibrant decorations. When you’re not exploring the town’s best attractions, such as Castle Garden, St. Jakobskirche, and the Medieval Crime Museum, get lost among the sights and smells of the Christmas market or kick back with a luxury hot chocolate. If you’re lucky, it might even snow.

Rovaniemi, Finland

12 Best Christmas Towns in the World Rovaniemi — © Roman Babakin / Adobe Stock

Rovaniemi is the ultimate Christmas destination. It is known as the official hometown of Santa Claus. You can explore the Santa Claus Village, meet Santa himself, and send letters from his official post office.

Rovaniemi offers thrilling activities, from reindeer sleigh rides to dog sledding. If you’re lucky, you’ll spot the Northern Lights in the evening. Rovaniemi is one of the most magical Christmas towns in the world.