CUENCA is Ecuador's third-largest city, but it feels more like a charming old-world town, with cobblestone streets and a rich collection of colonial-era churches, plazas, and buildings. A good deal of the city's colonial architecture remains intact, Cuenca is a UNESCO World Heritage Site. Before the Spanish arrived here, Cuenca was the second largest city in the Inca Empire (after Cusco). The foundations of former Inca palaces became foundations for the city's churches and government buildings. Amazingly, when the Incas conquered the area, in the late 1400s, the Cañari had already been living here for centuries. The Incas, not unlike what the Spanish would eventually do, used stones from the Cañari structures to build their temples and palaces. Several excellent museums here are dedicated to the city's rich and varied past. The Museo del Banco Central sits right next to the Pumapungo archaeological site, which was an Inca palace. Not only can you see the artifacts on display in the museum, but you can also tour the ruins of the palace, as well as its accompanying botanical gardens. A few blocks away, the Todos Los Santos archaeological site literally symbolizes the three layers of history, in a single area, you'll see structures built by Cañari, Inca, and Spanish settlers.
The Cañari (also spelled Kañari) people were the first known inhabitants of Cuenca, building a city here, around A.D. 500, called Guapondeleg. Their language and customs are largely a mystery, although several nearby villages still have names that end in "-deleg," a common Cañari suffix. Around 1480, the Cañari were conquered by the Incas, who called the city Tomebamba, the current name of the main river that runs through the city center. Tomebamba was one of the preferred cities of Inca King Huayna Capac, who spent much of his time here. But the Inca reign was short-lived -- they were vanquished by Pizarro and the Spanish conquistadors in 1534. The Spanish city of Santa Ana de los Cuatro Ríos de Cuenca was founded here in 1557.
Outside Cuenca, there's also plenty to see and do. Ingapirca, Ecuador's most impressive Inca ruins, is only 2 hours away, and Cajas National Park, which is full of scenic hiking trails and peaceful blue lagoons, is an hour north of the city.