Happening neighborhood: The oldest part of the city, called the Grund, is also the coolest, with a high concentration of pubs, cafes, restaurants and clubs.
If you only do one thing: Follow the Wenzel Walk, a self-guided tour that takes you past the city's centuries-old fortified walls, and in and out of castle excavations, underground passages and museums.
What's new: Construction has just started on the Museum of Modern Art Grand Duke Jean, designed by I.M. Pei and planned to open in about four years. If you can't wait that long, this year the National Museum of Natural History is mounting an exhibition of images of the natural world, "Wildlife Nature Photographers" (Dec. 16-Feb. 15).
Old-faithful restaurant: Bouzonviller, a Michelin-starred restaurant serving French haute cuisine, lies just outside the city center overlooking a valley.
Of-the-moment restaurant: The beautiful Restaurant Clairefontaine in the Grund is frequented by government types and visiting dignitaries.
With the kids: Take them to the doll museum in Vianden or for a ride on the Petrusse Express, a miniature train that travels on paved pathways on the outskirts of town and into the oldest sections of the city.
Side trip: Vianden is good for grown-ups, too. The charming old town, 45 minutes outside the city, is home to the largest feudal castle in the area, as well as to the Musee Victor Hugo and the Musee de la Poupee et du Jouet (doll and toy museum). The magnificently restored castle contains tapestries and period furniture.
Off-the-beaten track: Hike one of Luxembourg's many trails in the Ardennes, alongside the Moselle River or throughout the countryside.
Average per-night lodging rate: $226
Distance from airport to city center: Three miles
Information: 1-212-935-8888, http://www.etat.lu/tourism