The darkly Gothic harbourside city of Dunedin is the largest city in the southern half of the South Island, its population of around 120,000 bolstered by 25,000 students from the University of Otago – New Zealand’s oldest tertiary institution – who contribute to a strong arts scene, as well as vibrant nightlife, during term time at least.

The university aside, the city hasn’t had a lot of investment in recent decades and while some sections can feel a bit shabby it does mean that classic buildings remain unaffected by recent architectural meddling, giving a harmonious uniformity.

Although Dunedin spreads beyond the suburb-strung hills and surf beaches, the city has a compact and manageable heart, centred on The Octagon. This manicured, tree-lined green space is bordered by the art gallery, the Neoclassical Municipal Chambers and the schizophrenic St Paul’s Cathedral. Further afield, the newly revamped Otago Settlers Museum is sure to impress, while the Chinese Gardens offer contemplative calm. It is worth a look in the nearby Dunedin Railway Station even if you’re not making a journey on the time-warped Taieri Gorge Railway.

Beer and chocolate are always winners, best experienced on the Cadbury World tour and Speight’s Brewery Tour. Towards the north of the central city, Olveston gives a taste of Dunedin life from its heyday, a topic treated more formally in the Otago Museum. The Botanic Garden climbs up to the memorial on Signal Hill where you can look down on Otago Harbour, a sheltered inlet 22km long and no wider than a river in places. The harbour is protected from the ocean by the wonderful Otago Peninsula.

Local buses get you quickly to Baldwin Street, the world’s steepest, and to the sandy beaches of St Clair and St Kilda, the former with a classy hotel and cluster of cafés.

Brief history

From around 1100 AD, Maori fished the rich coastal waters of nearby bays, travelling inland in search of moa, ducks and freshwater fish, and trading with other iwi further north. Eventually they formed a settlement around the harbour, calling it Otakou (pronounced “O-tar-go”) and naming the headland at the harbour’s entrance after their great chieftain, Taiaroa – today a marae occupies the Otakou site. By the 1820s European whalers and sealers were seeking shelter in what was the only safe anchorage along this stretch of coast, unwittingly introducing foreign diseases. The local Maori population was decimated, dropping to a low of 110, but subsequent intermarriage bolstered numbers.

The Scots arrive

The New Zealand Company selected the Otago Harbour for a planned Scottish settlement as early as 1840 and purchased land from local Maori, but it wasn’t until 1848 that the first migrant ships arrived, led by Captain William Cargill and the Reverend Thomas Burns, nephew of the Scottish poet Robert Burns. With the arrival of English and Irish settlers the following year, the Scots were soon in the minority, but their national fervour still stamped its distinct character on the town.

The prospectors arrive

In 1861, a lone Australian prospector discovered gold at a creek near present-day Lawrence, about 100km west of Dunedin. Within three months, diggers were pouring in from Australia, and as the main port of entry Dunedin found itself in the midst of a gold rush. The port was expanded, and the population doubled in six months, trebled in three years and made the city New Zealand’s most important. This new-found wealth spurred a building boom that resulted in much of the city’s most iconic architecture, including the university.

By the 1870s gold mania had largely subsided, but the area sustained its economic primacy through shipping, railway development and farming. Decline began during the early twentieth century, when the opening of the Panama Canal in 1914 made Auckland a more economic port for British shipping. In the 1980s, the improvement in world gold prices and the development of equipment enabling large-scale recovery of gold from low-yielding soils re-established mining in the hinterland. Today you can visit the massive operation at Macraes, an hour’s drive from Dunedin.