Historically Budapest was two cities, Buda and Pest, divided by the Danube River until their unification in 1873 (the union also included Óbuda, a small Danubian village just north of Buda). The hilly Buda is regarded as peaceful, residential, and prosperous, whereas Pest is thought of as the boisterous side of the city that never sleeps.

With a large working class, gritty-but-grand pre-war streets, a vibrant cultural scene, and pulsating nightlife, Pest teems with energy. Most restaurants, bars, shops, museums, and tourist sites are in Pest. When visiting Budapest, it’s generally a good strategy to use Pest as your base, and selectively venture out to different pockets of Buda.

In Pest, most points of interest are within the Grand Boulevard or "Nagykörút". There’re exceptions of course, like the Heroes’ Square near the City Park, and the Ludwig Museum of Contemporary Art. Nagykörút is a broad avenue piercing through five different districts, and the unofficial dividing line between inner and outer city. Trams #4 and #6 carry over 200 thousand passengers along here daily (#6 runs all night too). While many guide books focus on destinations within the Grand Boulevard, it’s well worth venturing into the wider outer city to see where the majority of residents live. You don't need worry about looking behind your back, Budapest is a very safe city.

Downtown Pest has recently begun to be associated with international symbols of luxury. The Four Seasons Hotel Gresham Palace, The Ritz-Carlton, a branch of Nobu, the high-end Japanese restaurant chain, the city's four Michelin-starred restaurants, as well as high-end boutiques on Andrássy Avenue are all evidences of that.

When crossing to Buda, most tourists visit the Castle Hill, where the Royal Palace and Matthias Church are. Additional popular destinations include the Liberty Statue on top of Gellért Hill, and two of the well-known thermal baths, Rudas and Gellért. For a more offbeat experience in Buda, visit the area around Bartók Béla Way in District 11. It's a revitalized neighborhood with art galleries, cafés, and bars, and without the storm of crowds found in most parts of Pest.

Similar to other big cities, some parts of Budapest have been radically transformed due to the inflow of mass tourism. Formerly residential neighborhoods have lost their original functions and inhabitants. By far the most touristed area in Buda is the Castle Hill.

In Pest, Váci Street, the streets surrounding St. Stephen's Basilica (Zrínyi, Október 6., etc.), and Gozsdu Udvar in the old Jewish Quarter are all teeming with tourists. The service sector in these locations consists of reputable providers, but they tend to be overpriced and rarely frequented by ordinary Hungarians. It's worth venturing out into the wider city for a more authentic view of everyday life, beyond “traditional goulash”-oriented restaurants, and souvenir shops. District 8 is one of the up-and-coming areas that's still relatively under the radar despite a gorgeous housing stock and hip restaurants. Read the district-level descriptions to learn more about specific neighborhoods and recommended places therein.

Like other urban centers, Budapest is also experiencing gentrification. Here, it's taking longer for neighborhoods to transform because the vast majority of people own their apartment residencies, so eviction is rarely the case unlike in cities where renting is more prevalent. Nonetheless, the buzz of the former Jewish Quarter and the fading grandeur of the inner parts of District 8 are drawing an influx of young, middle-class local professionals as well as tourists. These new residents are now shaping neighborhoods in-line with contemporary international tastes but with little regard for the locations' cultural histories.

There isn’t any one neighborhood in Budapest that's categorically fancy or elite. Rather, most neighborhoods have a mixed group of lower and middle income residents. This otherwise positive phenomenon (it creates more diverse and interesting communities) is an incidental heritage of communism's large-scale forced reshufflings of people into, out of, and within Budapest.

Nonetheless, Buda, with its greenery and residential neighborhoods (particularly parts of District 2 and District 12), is considered an elite area, and sections of District 5 and Andrássy Avenue in Pest are also prestigious.

The easiest way to tell which of the 23 districts a given address falls into, is simply to take the two middle digits of the zip code (i.e. a 1146 zip would imply the 14th district).