My husband and I recognized the transformation instantly upon our arrival at Marrakech’s airport for a week’s vacation last April. After six years away from the Moroccan city we once called home—and where our daughter, now ten, learned to converse in a rapid-fire medley of Arabic, French, and English—it was no surprise that changes had occurred in our absence. But who knew they would be so immediate?

The terminal we remembered as being a modest structure of faded pink stucco, where stray cats slinked through the waiting room, had been expanded with a sweeping grand concourse designed by the French firm CR Architecture and E2A Architecture of Casablanca in a style that could aptly be described as Maghreb Mod. Giant rhomboid skylights fitted with photovoltaic panels filtered the blazing sun, the soft, diamondlike openings following the curve of the roof and morphing into glass walls frosted with an arabesque pattern. Across the face of the new building stretched a long metal canopy, a brise-soleil pierced with traditional North African star motifs. There was even an outpost of Hudson News selling scores of global magazines. Dowdy Marrakech-Menara Airport had become groovy and eye-opening—a worldly symbol of a Marrakech markedly different than the one we left behind. (To browse a slide show on where to eat, shop, and stay in Marrakech now, click here.)

Not that the fabled Red City, founded in the 11th century by Sultan Youssef ben Tachfine, had slumbered during our time there, from 2003 to 2006. Major changes were already afoot. Once a byword for louche living, where tailleurs gave way to caftans and supine was the preferred posture, Marrakech had lost much of the druggy bohemianism that made its reputation in the 1960s and ’70s. Chic boutique hotels known as maisons d’hôte were springing up the medina, while posh resorts began to creep across the city’s sandy outskirts, welcoming well-heeled and well-traveled Europeans as well as elites from the Persian Gulf, for whom Morocco represents an escape from strictures against immodest clothing, public mingling of the sexes, and drinking alcohol.

At its core, however, Marrakech remains a crowded, cacophonous city, where sand-color Mercedes-Benz taxis jostle with mopeds, bicycles, carts pulled by worn-out donkeys or middle-aged men, feral cats, package tourists in T-shirts, and oblivious jaywalkers wearing everything from homemade djellabas to designer jeans. Marrakech is a market town, blessed with all the importuning that implies. In the walled city known as the medina—a UNESCO World Heritage site—hundreds of vendors, like their forefathers before them, gently sidle up to unsuspecting passersby with sibilant offers to consider a Berber carpet or a fragrant spice, while hustlers in the sweltering Jemaa el Fna Square scrounge up a day’s wages by showing off tame rhesus monkeys or charming cobras (the serpents’ mouths are sewn shut, by the way). The sunbaked terra-cotta-red buildings are still architecturally modest, their unremarkable façades giving no hint of whether they shelter a hovel or a palace. Neighborhoods ring with the sounds of artisans beating metal into lanterns. And five times each day scores of minarets broadcast the call to prayer, a throaty, melodious wail that is the Islamic world’s answer to church bells and to my mind one of the most hypnotically beautiful sounds on the planet. Equal parts mercantile, mysterious, and maddening, Marrakech is the most fascinating place I have ever lived and the only one I have ever truly missed.

Marrakech, like most major Moroccan cities, offers two faces to the traveler, a product of its legacy as a French protectorate from 1912 to 1956. One is the dusty medina, an embodiment of Morocco before Western powers took a geopolitical interest in this corner of the Maghreb. The other is the Ville Nouvelle, often referred to as Guéliz, the modern town that the French built outside the medina, an urbane community of spacious boulevards and tree-shaded streets that was originally lined with clay-color Art Moderne villas as neat as sugar cubes.

Some of the charming residences of yesteryear survive, though most are crumbling. The best can be seen in the neighborhood around La Saadia, also known as Villa Taylor, a Moorish extravaganza commissioned from Poisson in the 1920s by New York millionaires Edith and Moses Taylor. That magical estate is where Winston Churchill and Franklin Delano Roosevelt spent a night following the wartime Casablanca Conference in 1943.

Increasingly, however, that evocative colonial atmosphere, dismissed as irrelevant by many younger Moroccans, has all but disappeared. Smart, if often stylistically dubious, apartment towers have sprouted along Avenue Mohammed V, the Ville Nouvelle’s main artery, interspersed with chain stores such as Zara Home, Lacoste, Guess, and Etam. Relieving the parade of global labels, however, is a promising handful of venues championing Moroccan contemporary art, including the outstanding David Bloch Gallery and Galerie Rê. Like the country’s wine industry, Morocco’s art community is unexpectedly vibrant and underappreciated—but it’s beginning to attract the attention it deserves.

The city now hosts a biennial festival (the latest edition was held earlier this year) that bills itself as “an international gathering of performance, screening, and debate.” Its leader is British arts patron and philanthropist Vanessa Branson, a part-time Marrakech resident, former gallerist, and sister of Virgin Group’s Sir Richard Branson. She is also an owner of Riad El Fenn, a sensationally stylish maison d’hôte that opened eight years ago in the medina’s Bab Laksour neighborhood and instantly put all other boutique hoteliers on notice, what with its gleaming tadelakt walls hung with works by contemporary artists such as Bridget Riley and Antony Gormley and seated rooftop dinners for a hundred or more. Since then Riad el Fenn has taken over a couple of neighboring mansions, so it now has three swimming pools and a strikingly seductive bar whose beamed ceiling is encased entirely in mirrored glass.

To be sure, the city’s march of progress has sent housing prices skyrocketing and led to an influx of discotheques, golf courses, and gated communities. “Saint-Tropez minus the yachts” is how the German newspaper Der Spiegel described Marrakech a couple of years ago. Of course, one can’t deny that all the construction projects do provide work for laborers, and the new hotels, restaurants, galleries, and shops mean more jobs in a country with significant unemployment.

Still it was painful to discover that a particularly romantic mansion in Guéliz dating from the 1920s, an Orientalist whimsy on rue Ibn Aïcha, had been replaced by an apartment block of depressing mediocrity. Not far away, I was briefly dismayed to come across another residential tower on the spot once occupied by the restaurant Bagatelle, a homey, family-owned culinary icon since 1949, where my standard Wednesday luncheon had always been avocat vinaigrette, foie de veau persillé, and a couple of heady gin fizzes. To my joy, however, the restaurant had been been reincarnated on the same block, and its old-fashioned cuisine is as intact as the vintage black-and-white photographs of Marrakech’s French colonial days that line the dining room’s polished wood paneling.

Other beloved landmarks have been rejuvenated as well. The public botanical garden known as Jardin Majorelle, a 1930s gem saved from destruction by Yves Saint Laurent and Pierre Bergé in 1980, was a weedy wonderland when I last wandered its shaded paths. Since then American landscape designer Madison Cox has sensitively restored the nearly one-acre paradise, which also houses a small, exquisite museum that hosts exhibitions of everything from Saint Laurent’s Moroccan-inspired couture to Berber costumes. Elsewhere, the museum known as Palais Bahia—a late-19th-century landmark in the medina that novelist Edith Wharton called “the loveliest and most fantastic of Moroccan palaces” in her 1919 travel guide to the country—had long been maintained in a desultory fashion by the Ministry of Culture. But the complex’s days of benign neglect are numbered, thanks to a two-year, $2.2 million restoration directed by local architect Mohammad Lemcherfi.

The city’s array of hotels has been exponentially enriched, too, both inside the medina and out. Prince Fabrizio Ruspoli has gracefully expanded the exquisite La Maison Arabe, which he has owned since 1996, dappling the medina destination with bronze light fixtures by designer du jour Yahya and adding a subterranean spa enriched with traditional zellige tilework. The hotel’s signature restaurant was better than I remembered. Our daughter, Catherine, pronounced the silky carrot soup “the best I ever had,” which brought a gratified smile to the Paris-born nobleman’s handsome face.

French interiors guru Jacques Garcia transformed the long-tired La Mamounia hotel into the acme of glamour with a three-year renovation that was completed in 2009—and which seems to have resulted in the largest order of red velvet upholstery in history. Though its former boutiques featuring local talents in jewelry and fashion have been swept away in favor of global luxury brands, the almost 90-year-old hotel does offer the best people-watching perch in town—the Majorelle Gallery, an 80-foot-long, double-height interior promenade flanked by an alluring, dimly lit bar and restaurant and divided by button-tufted banquettes that seem to stretch for miles. (I do quibble with the location of the spa, however, which requires patrons to stroll through the lobby in terry-cloth robes and slippers.)

Beyond the city walls, where the five-star Amanjena long reigned as the ultimate getaway, spa-resort competitors have proliferated at an astonishing rate. Last year the Four Seasons Resort Marrakech opened on a prime piece of real estate near the bucolic Menara Gardens, a royal orchard and olive grove dating to the 12th century. This past April saw the debut of the Oetker Collection’s Moghul-style Palais Namaskar. A month later entrepreneurs Saida and Abdeslam Bennani Smires unveiled the Selman Marrakech, also decorated by Garcia, where beds of white roses alternate with paddocks for the family’s Arabian Thoroughbreds. Spa lovers take note: The Selman is the only resort in Morocco that offers the cutting-edge biontology treatments devised by French wellness guru Henri Chenot.

Out in the sprawling Palmeraie oasis—an estate-strewn area that is the Marrakchi Palm Springs—American expat architect and designer Stuart Church has conjured the lush Taj Palace Marrakech, a heady hybrid of sultanic Morocco and princely India that will begin welcoming guests later this summer or in the early fall. In addition, the Delano Marrakech is slated to open in September, the Mondrian Marrakech will arrive next year, and Armani has plans to add a luxury hotel to the landscape, scheduled for 2015.

The best of all these new additions to the booming hospitality landscape, however, is the Royal Mansour, constructed on eight prime acres in the medina. Concocted by a consortium of impeccable tastemakers—the international architecture and design firm OBM, the French interior design team 3BIS, and Spanish landscape architect Luis Vallejo—the resort is palatial, which stands to reason, since it was bankrolled by Mohammed VI, who co-opted one of the arched city gates as the hotel’s entrance. His Majesty wanted the Royal Mansour to honor traditional Moroccan craftsmanship, which explains all the exquisitely carved white plaster, or gebs, and handmade, handcut tiles set into starburst patterns with the perfection of pavé diamonds, executed by more than a thousand of the country’s most accomplished artisans. Rather than a typical layout of guest rooms spread across floors of a hotel, the Royal Mansour offers 53 three-story riads, or traditional courtyard houses, scattered throughout its gardens.

In addition to being an object lesson in Moroccan style at its most refined and costly (the budget remains a state secret), the Royal Mansour has become something of a court hangout. My husband spotted the king’s dazzling young wife, Lalla Salma, lunching on the terrace. A lissome redhead in flowered capri pants and sunglasses, she was separated from us by a Maginot Line of unoccupied tables and watched by a discreet battalion of clean-cut bodyguards. Her presence was something of a surprise. After all, back in the days of the present king’s father, Hassan II, the royal wife was never seen in public and had no title. But if the consort of the present Commander of the Faithful can show up at a local restaurant, with her offspring in tow, then Marrakech—indeed all of Morocco—has entered a new era.