Editor's Note: While in Europe, travel writers Judi Janofsky and Rich Steck filed daily features as part of a virtual three-week grand tour.

Picture this: an Arabian Nights palace perched a thousand feet above the Mediterranean Sea, surrounded by terraced gardens lush with thick grape vines, colorful lemon trees and graceful palms. Around the palace lies a medieval village, adorned by beautiful Moorish villas and gardens and frequented by world-renowned writers, composers, actors and, even royalty.

You've just pictured Palazzo Sasso in the charming town of Ravello on Italy's Amalfi Coast.

View from Palazzo Sasso.

It took two years and twenty million dollars to rescue Palazzo Sasso from 20 years of neglect following its heyday when it was known as Hotel Palumbo. (In one of Palumbo's rooms General Eisenhower planned his attack on Monte Cassino. Rosselini and Ingrid Bergman reprised the earlier Garbo/Stokowski romance in its restaurant. )

Today Palazzo Sasso's restoration has re-created its Moorish heritage - the original palace dating back to the 12th century was restored and expanded in the 17th by the Sasso family - obvious in its columns, pointed arches and marble interiors. Inside, its walls are soft creams, browns, white and sage, a perfect setting for the golden draperies, Oriental rugs, marble floors and magnificent antique furniture pieces, all linked in a harmonious flow of elegance.

But what keeps you spellbound throughout your stay is the view. From every room - the reception area, library, bar and art cafe, restaurant - the hotel's cliffside location offers breathtaking views of the Amalfi coast.

Be sure to take time for a cocktail in the intimate luxe bar. Sit in one of the cozy nooks with great windows opening onto the warmth of the seascape in daylight and the romance of moonbeams at night.

The restaurant, Rosselini's, has been given a well-deserved Michelin star and the hotel itself has earned a five-star diamond award from the very particular American Academy of Hospitality Sciences, as well as being ranked third best hotel in Europe in Conde Nast's 2002 Reader's Choice Awards.

Such top honors are exemplified by the little touches in each of the 39 rooms and five suites. Like the exclusive Frette Sleeping Menu which lets you choose the linens you prefer: 200 thread-count Indian percale, pure Italian linen or 300 thread-count satin. Pillow choices, too: hypoallergenic, feather or latex foam.

The gold-fixture, marble bath features Jacuzzi shower enclosures with vertical pulsating sprays, overhead fountain cascades and soft shower falls. Plus oversize bath sheets warmed on triple tiered racks.

Outside, grass terraces leading down the hillside include whirlpools and sunning areas, a heated pool with an underwater window overlooking the sea and workout equipment open to the sweet breeze but tented overhead to shade from the sun.

With a staff of over 90, the hotel offers a one-to-one guest/staff ratio. It's obvious from your stay that service and guest care are paramount here.

Palazzo Sasso is open March to November. Current rates $235 to $1,590 per room, including a lavish buffet breakfast indoors or on the terrace. Reservations and information at www.palazzosasso.com or call 800-225-4255.

Next week we'll explore the smaller towns of Tuscany.

- Judi Janofsky and Rich Steck