Just a stone's throw from Otavalo, Peguche makes a welcome break for those looking for some peace and quiet after a hard day's bargaining in Otavalo Market. The town is sleepier than it once was, as the train tracks have been abandoned since the late 1980s, but Peguche is friendly and welcoming, if a little ramshackle.
Peguche is home to a pretty waterfall, along with a number of stalls that line the path to the entrance. Here, vendors will try to persuade you to part with your cash before you head to Otavalo. A number of musicians also live in town. You may see them playing their pan pipes, accompanied by dancing local children. The facilities in Peguche are limited to just a couple of hotels with adjacent restaurants and just one or two grocery stores in the center. Stock up on anything you might need while you're in Otavalo.