Fabulous retreat in Moroccan medina

In these increasingly globalised times of ours, I often wake up in the morning and wonder where I am. So many hotels look the same the world over.

It's different in Morocco. Over the past decade, this enigmatic North African country has had an accommodation revolution. Uninspiring identikit chains - and scrappy guesthouses - are still here but there are now an impressive number of hotels converted out of creaking old dars and riads, the traditional Moroccan houses and palaces centred on courtyards and gardens.

Dar Attajalli, in Fez, is a fine example. A bewitching hideaway, it sits at the heart of the most atmospheric of Morocco's myriad medinas.

Like many dar-hotels, which blend modern comforts with old-fashioned charms, Attajalli's transformation was financed by a foreigner (in this case, German Kleo Brunn) and restored - and staffed - by Moroccans. Having initially come to Fez to study Arabic, Kleo tells me she stumbled across "a gold rush" of outsiders buying up downtrodden properties.

"I was completely blown away by the beauty of the old houses here," says Kleo, who fell for a property that's believed to be at least 200 years old and was formerly home to descendants of the Alaouites, the Islamic dynasty that has ruled Morocco since the 17th century.

The enterprising German spent three years meticulously restoring the rundown building, living on site and putting her "heart and soul and lots more" into a process that involved the work of more than 100 masons, carpenters and artisans.

The results are spectacular - especially the neck-craning central courtyard, which glistens with dazzling mosaics of zellij (intricate hand-painted tiles).

There's a stand-out mural fountain and a cosy lounge area matted with comfy cushions - a perfect place to read one of Kleo's books about Fez and Islamic architecture. Upstairs, the four bedrooms are decorated with antiques purchased from the medina's spellbinding souks, as well as furniture and objects created by local artisans based on designs that Kleo had drawn up herself.

Studded with lemon trees, Attajalli's roof terrace is irresistible, offering magnificent medina views. I gaze over a seemingly endless ocean of mud-brick rooftops, clustered with satellite dishes and pierced, at various points, by towering green minarets.

Breakfast is served up here - an organic, locally sourced feast, including bread, fruit, dates, olives, goat's cheese and butter and a clutch of Moroccan sweets.

A real energy-booster, it's just what you need ahead of a day exploring the medina's smorgasbord of souks, workshops and majestic Islamic relics. Fez is a place for which the phrase "sensory overload" was invented. It's hard to believe that you can fly two or three hours from Europe and find a place so completely and utterly "foreign".

I get lost countless times in the medina - a dusty labyrinth jammed with workshops and stores teeming with carpets and brass teapots, leather jackets and babouches (slippers), spices, soaps, perfumes, oils and potions, and 1001 other eye-catching and olfactory- heightening things.

I watch as old men in robes (djellabas) clutch crowing roosters and plod past halal butchers, fishmongers and fruit-and-veg stalls, and I dodge donkeys, laden with sheep hides, stomping to pungent-smelling dye pits.

Despite no longer being the capital - an honour now belonging to Rabat - Fez is still seen by many as the country's heartland.

It was established around the turn of the 9th century and flourished as a centre of religious, political and cultural importance.

Relics of its golden age remain, including Al-Karaouine university, thought to be the world's oldest operating institute of higher education.

It's closed to non-Muslims but for a small fee you can enter the neighbouring Medersa el-Attarine, a Koranic college that dates back to the 14th century. It displays the elaborate zellij, sculpting and stucco work that Fez is renowned for.

While atmospheric old Fez is imbued with a somewhat antediluvian vibe, it's flecked with modern touches.

Take Cafe Clock, a trendy "cross-cultural" spot opened by Englishman Mike Richardson.

Expats, tourists and locals flock to this restored 250-year-old building, which hosts calligraphy lessons, Moroccan cookery and etiquette classes, and concerts.

Clock's food is popular; one of its culinary highlights is a "gourmet" camel burger.

There's fast, free wi-fi too, so you can send a snap of this unusual delicacy - plus a "wish you were here" message - to loved ones over cyberspace.

• fact file *

·Rooms at Dar Attajalli are priced from 󌎅 ($125) a night including breakfast. attajalli.com.

·You'll find Cafe Clock at 7 Derb el Magana in Fez's old medina. cafeclock.com.

·For general tourism information, see visitmorocco.com.

Steve McKenna was a guest of Dar Attajalli.