"What do you like best about Key West?" I asked our 7-year-old daughter.

"Seeing the same people in all different places," she said.

While I hadn't expected this response, I understood what she meant. For a child growing up in a huge metropolitan area like Washington, one of the charms of Key West is its tiny size. It's the sort of place where you can swim in the public pool alongside the same man you saw the night before, earning his living by balancing a sword on the tip of his tongue.

Key West, an island city just 3 1/2 miles long and two miles wide, is the southernmost pearl in the strand of islands known as the Florida Keys. The town, historically a haven for bootleggers, wreckers and pirates, has become known in recent years as a freewheeling resort. Some parents might think twice about choosing such a place as a vacation spot for their children. We wondered a bit ourselves when we wrote away to the Key West Chamber of Commerce and were sent a list of guest houses, half of which stipulated "no children" or "enlightened adults only."

But we found Key West to be a wonderful getaway for our family, in part because of this live-and-let-live attitude. The place fosters eccentric people -- "characters," as our 5-year-old would say.

Some of these characters may be seen each night, performing on Mallory Dock during the ritual sunset watch. Ai Bashi Ai, a Rastafarian contortionist, had us cringing as he turned himself into a pretzel, waving at us with his feet, which were perched where his shoulders should have been. A Budapest-born performer -- the one we later saw at the swimming pool -- balanced chairs, glasses, even a bicycle on his mouth, with only a small towel as a cushion. Another performer, a wisecracking acrobat standing flamingo-style on a makeshift high wire, had our children laughing as he asked, "Could I please have six or seven chubby people volunteer to lie down under me? I don't have a net."

With so much going on, it's easy to forget to watch the sunset. Don't miss it. Buy the kids a brownie, turn your back on the circus acts for a few minutes, dangle your feet over the dock and watch the sun slip into a warm and sultry sea. There's nothing like the sight of a palm tree silhouetted against a sky streaked with rose, salmon and violet to give you fresh perspective on life.

All of nature is more dramatic in Key West -- the birds, the plants, the bugs, the water. You're in the tropics, and in spite of the booming development going on, paradise is still all around.

Back at home I can't tell the difference between a sparrow and a titmouse, but in Key West, we all became avid bird watchers. Strolling down White Street Pier, we watched snaky-necked cormorants dive for fish, while blue herons and egrets waded nearby. Pelicans soared with startling grace. From our patio, we saw frigate birds, pileated woodpeckers and white-crowned pigeons. Our son carried on long conversations with an unseen parrot that lived behind us. Parrots (tamed) are a frequent sight, and may be seen riding on the shoulder of many a cyclist.

The children quickly caught our enthusiasm for tropical wildlife. Lizards of all descriptions flourish here, and the kids never tired of trying to catch them. Insects of bizarre colors and sizes, including one with tiny "headlights" that blinked on and off, were an endless source of amazement.

The most wonderful source of delight, though, is the sea itself. What Key West lacks in sparkling sand beaches, it more than makes up for in its water. If you are familiar with the Atlantic elsewhere, you will scarcely believe it is the same ocean. Unlike the gray and brooding ocean up north, the waters of the tropical Atlantic are turquoise, crystal clear and calm.

The enormous coral reef, stretching for miles offshore, acts as a barrier to waves, turning the ocean into an ideal swimming hole for small children. Visibility out at sea can easily be 60 feet down or more. Even snorkeling close to the beach can be an adventure.

We spent our afternoons at Memorial (also known as County) Beach, where a collapsed pier draws parrotfish, sergeant majors, grunts and other exotic fish. Rafts and snorkel gear may be rented from a small straw hut on the beach. Our 5-year-old, not quite ready to master snorkeling, lay on a raft, donned an inexpensive pair of swim goggles and, by dipping his head in the water, saw dozens of tropical fish, which he soon learned to identify. In fact, after a few weeks in the ocean, our children grew accustomed to swimming with all sorts of weird creatures, including mean-looking barracuda (one local youngster told us about a four-footer named George, but we never saw him) and stingrays.

Families with teen-agers or adventurous parents will enjoy trying out a sailboard. Our 14-year-old niece also took a parasail ride, in which she was strapped in a parachute and pulled by a motorboat, allowing her to float like a helium balloon over the Atlantic.

For families with decent swimmers, taking a boat out to the coral reef for a snorkel trip is a must. For those with small children, an alternative is a glass-bottom boat ride. The glass affords a surprisingly clear view of the ocean depths, but unfortunately the time spent over the reef is an all-too-brief 20 minutes. Our kids did get to see a monstrous brain coral and a beautiful midnight parrotfish, though, and fed popcorn to a teeming band of yellowtail that followed the boat.

A nice break from the salt water, especially if you're not staying at a motel with a pool, is Key West's only public pool. The Community Pool, at Catherine and Thomas streets, is seldom crowded. It offers morning lap swimming for grown-ups and in the afternoon opens up for everyone. The pool is free, including free Red Cross swim lessons in the summer, of which our children took advantage.

While the weather in Key West is generally warm and sunny, afternoon showers are common. But even if you hit a gloomy spell, there's still plenty for kids to do:

The Key West Aquarium features tropical fish and shells in an inviting setting. An informative, 40-minute tour gives children the opportunity to touch a live baby nurse shark and a stingray, and to watch giant sea turtles being fed. They also can buy a fistful of "fish chow" for a dime and feed tarpons and parrotfish themselves.

East Martello Tower, an old fortress with lovely brick archways, contains exhibits highlighting the history of the Keys, including the poker table used by Harry Truman at his Little White House, cigar maker's tools, antique dresses and carriages, an accordion, ship chandlery and a wonderful miniature house (in which only a child can stand upright) filled with old-fashioned toys.

The Lighthouse Museum on Whitehead Street offers a look through a periscope, an old-timey dive suit and model ships, and a chance to climb the 88 steps to the top of the old lighthouse for a panoramic view of the island.

Mel Fisher's Treasure Exhibit is a sure hit with older children. Fisher made it his life's work to find the Atocha, a shipwrecked Spanish galleon carrying tons of gold, silver and other riches home from the New World. Fisher's single-minded search finally bore fruit with his discovery of the Atocha and the ship's treasures. It's one of the most exciting modern-day adventure tales around, but the museum's introductory video is surprisingly dull -- enough to give our younger one the fidgets. But the displays are worth seeing, among them fabulous necklaces, a tiny silver fork and spoon and a golden chalice. You can also lift a real gold bar -- it's heavy! -- and see the re-created hold of the Atocha.

If your family is still full of energy after a day of treasure-hunting, Key West offers a smattering of nighttime activities. Most of the nightlife is strictly geared for grownups, though, with a bar to suit every taste and plenty of live music.

The best evening entertainment we've already mentioned: sunset at Mallory Dock, followed by an ice cream cone. Another way to view the sunset (it says a lot about Key West that watching the sun go down each evening is a major preoccupation) is from the top of Key West's tallest building, La Concha, the pink hotel on Duval Street. La Concha was recently rescued from seedy abandonment by Holiday Inn. The viewing balcony has been expanded to wrap around three sides of the building, and it's a great place for children. They can perch on tall stools, sipping (or spilling in our case) their Shirley Temples and taking in a sweeping view of the entire island. Sunset from six stories up is even more breathtaking than from down below.

For more traditional family nightlife, Magic Carpet Golf offers two miniature golf courses, games and a video arcade. There also are half a dozen movie theaters on the island.

Even turning in at the end of the day can be an adventure, if you're lucky enough to be renting a house or apartment on the west side of town, called Old Town. Your children will be able to invite home chameleons and the descendants of Hemingway's six-toed cats, and you'll have the chance to chat with native Key Westers (known as Conchs) in the neighborhood. And you'll be able to pretend, if only for a short time, that the back patio overflowing with hibiscus, bougainvillea and avocado trees really does belong to you.

Beth Baker is a free-lance writer living in Takoma Park.