The 65-foot Gold Coast yacht swinging into the Key West Bight portrays "Santa's Christmas Luau" with palm trees, a tiki hut, a roasting pig and an icing of lights. Filled with 125 lei-wearing passengers, the boat passes below the judging station at the Schooner Wharf Bar, and even a Grinch, wearing a red Hawaiian shirt and grass skirt, tries to steal the pig. The real Santa arrives to save the day, and his elves celebrate by doing the limbo. I sip hot apple- jack, staving off an unusual December chill, and revel in this small-town hominess mixed with a Mardis Gras flair that can only be found in Key West.
I'm drawn here for an annual bevy of events that seam- lessly blends past with present, and this 19th Annual Lighted Boat Parade, reminiscent of the 19th-century rows of schooners that were always floating in the harbor with flags and bunting each December, is certainly no exception. On an island where "if somebody sneezes, we throw a parade," says local Barb Grob, the holidays bring more than just another neatly packaged festival. This diverse community comes together each year to participate — and compete — in events that at first glance may resemble those found in other small towns. And upon further inspection, they reveal an over-the-top indulgence in all things holiday set against the backdrop of an island with a rich history.
Since the early 1800s when settlers first found their way to the island from New England, the Bahamas, Cuba and other far-flung locales, Key West's Conchs, as the locals call themselves, have been celebrating the holidays with their own inclusive island twist. In those days, the residents were isolated, relying on sailing vessels to bring in supplies, so they made ornaments from shells, bows, candles and sea beans to decorate the palms and gumbo-limbo trees that dot the island. Wreaths and garlands were fashioned from grape vines, palm fronds, Spanish moss and flowers. And in a tradition still very much part of Key West life, parades, parties and masquerades went on until the wee hours.
Evidence of this multicultural Christmas Day revelry was reported by the Florida Times-Union on Dec. 30, 1890: "Toward evening the people, young and old, turned out in large numbers, driving and promenading — the ladies and children being handsomely dressed, and as lightly as a day in June. The Cubans thronged the street cars and assembled at the south beach — blowing whistles and flying kites until sundown."
As opposed to feeling like an outsider looking in, I'm immediately wrapped up into the family fold and whipped into an appropriate yuletide frenzy. Once the last of the parade entries threads the route, I head to the Key West Harbor and show my "Golden Ticket," a gold room card for the Sunset Key Guest Cottages(sunsetkeyisland.com), a resort on a secluded 27-acre island 500 yards from the harbor. This gains me access to the 24-hour water shuttle, and minutes later we're cutting through the Gulf of Mexico's foamless chop. The boat glides under a full deep- yellow moon, which, in a serendipitous astronomical moment, is the closest it's been to earth in 15 years. In the distance sits what now feels like my private island, and the soft green and white lights outlining the swaying palms become a beacon pulling me home.
In the morning, a picnic basket of fruit and fragrant banana bread beckons from my two-bed- room cottage's back porch. Paired with fresh orange juice that housekeepers (seemingly magical elves themselves because I never saw them) left during turndown service and a pot of coffee from my full kitchen, breakfast is served ocean-side.
The resort's 37 cottages give an architectural nod to Old Town Key West with the pastel-pink, yellow and sea-foam exteriors, tin roofs and louvered shutters. The porches feature ceiling fans, rocking chairs and holiday wreaths of the past, handcrafed with grape vines, fresh bromeliads, orchids and palm fronds. As the first tinges of blazing red and orange fire up the outline of Key West, I wander the twisting pathway toward the pool past silver buttonwood hedges and white picket fences entwined with a rainbow of pink, orange and purple bougainvillea. I eye Flippers Bar in the corner, visions of frozen drinks dancing in my head. Moments later, a breeze catches the mesquite smoke billowing from the large iron barbecue.
The holidays are an important time for families on the island, and Toni Estes from the town of Rayville, Louisiana, says she cherishes the security of the island where their four children can roam without restraint, making it a worry-free "true vacation." Currently on their third trip to Sunset Key this year, Estes notes how they enjoy the nightly holiday movies by the pool. "Our children are able to laugh atHome Alone by a lush lagoon pool in their swimsuits during the coldest month of the year!" she says gleefully.
HOLIDAY SHOPPING 
My list (of both naughty and nice) grows heavier in my mind, so I reluctantly decide to head back to "civilization" for some shopping. All of the shops and restaurants on Duval Street are lit up like, well, Christmas trees, with every inch of gingerbread trim and porch railing festooned in some manner. A peek into the Bull & Whistle Bar reveals a fully decorated tree whimsically hanging upside down in the corner of the dim interior. The bells at St. Mary's, the oldest Catholic parish in South Florida, toll "Hallelujah" on the hour. Passing Paradise Tattoo, I do a double take at the black-clad, hard-core inkers, who are surrounded by bright construction-paper chains, small blinking trees standing in fake snow and plastic candy canes. At Fast Buck Freddie's, I enter a labyrinth of the holidays on steroids, leading to four nine-foot glittering Christmas trees in sumptuous themes like deep-purple and green peacocks, ice-blue bulbs with white berry sprigs and violet and silver-mercury glass reindeer. "Every item I buy for the store, down to the last ornament, has to be inspiring in some way," says David Smith, buyer and decorator for Fast Buck Freddie's since 2000. "I want people to come in here and think, 'I've got to buy that now because I'm never going to see it again.'"
My list (of both naughty and nice) grows heavier in my mind, so I reluctantly decide to head back to "civilization" for some shopping. All of the shops and restaurants on Duval Street are lit up like, well, Christmas trees, with every inch of gingerbread trim and porch railing festooned in some manner. A peek into the Bull & Whistle Bar reveals a fully decorated tree whimsically hanging upside down in the corner of the dim interior. The bells at St. Mary's, the oldest Catholic parish in South Florida, toll "Hallelujah" on the hour. Passing Paradise Tattoo, I do a double take at the black-clad, hard-core inkers, who are surrounded by bright construction-paper chains, small blinking trees standing in fake snow and plastic candy canes. At Fast Buck Freddie's, I enter a labyrinth of the holidays on steroids, leading to four nine-foot glittering Christmas trees in sumptuous themes like deep-purple and green peacocks, ice-blue bulbs with white berry sprigs and violet and silver-mercury glass reindeer. "Every item I buy for the store, down to the last ornament, has to be inspiring in some way," says David Smith, buyer and decorator for Fast Buck Freddie's since 2000. "I want people to come in here and think, 'I've got to buy that now because I'm never going to see it again.'"
Wandering up to Simonton Street, I decide that comestibles and libations might make for much better gifts. Key West Winery has a bevy of tropical-fruit wines. The Key West Limen offers an appropriate pucker, while the Hurricane Class Five blends five other wines, perfect for an after- noon on the water. Next door at the Blonde Giraffe, workers steadily dip slices of creamy Key- lime concoctions into dark chocolate and pack them for shipping. I'm quickly scratching names off my list and am still package-free, as everywhere I've been ships, and some even gift-wrap.
At the intersection of Margaret and Caroline, the Key West Art Bar has opened in the Flagler Station Building, which is an exact replica of the original Florida East Coast Railway Station. In front sits a stoic bronze bust of Henry Flagler, accessorized with a silver tinsel necklace and red ornament earrings. The 2,500-square-foot indoor/outdoor space is an interactive experience where you can get everything from a high-end oil painting to wearable-art jewelry to a three- foot sock monkey. Grob, the owner, is a creative force of nature, boasting a red sequined velvet tunic and a vivacious enthusiasm that's magnetic enough to make anyone an instant art lover. "This is not a normal gallery," Grob says while sampling a Taylor Fladgate during her holiday port tasting. "You don't feel like you're in a quiet museum — buy something or hit the road. Hang out, get involved and meet people."
Grob explains that the kickoff for locals is the Annual Holiday Parade on the first Saturday of every December on Truman Avenue. "This one is truly a local's event, and you won't see this type of Christmas parade in any other small town in America," she notes. "The mayor is next to the drag queens, who are next to the boy scouts. If you want to wrap yourself in tinsel and walk down the street, you're in." And on Christmas Day, she adds, you're more likely to see locals grab their gear and head for the sand than sidle up to a buffet. "I plan on sharing a sunny day with friends, eating too much and just hanging out atFort Zachary Taylor State Park's beach."
Several locals mention the new piano bar, the Keys, on upper Duval as a great counterpoint to the boisterous Duval crawl on the lower end. Grob, the ultimate goodwill ambassador, offers to take me there herself. At this New York-style establishment, the sounds of Broadway greet us. The soft banquette seating and low lighting call for something cold in a martini glass and subdued conversation while we gaze at a tree adorned with music-themed ornaments next to a glowing menorah.
NO RSVP REQUIRED Horizontal in a hammock, my head is cradled inches above white Bahamian sand. The cheerful "Santa Claus Is Coming to Town" floats from the outdoor bistro, Latitudes. I also see someone dangling from a candy-colored parachute over the water. (Is Santa early?) As tempting as it is to stay at the resort ad infinitum, I've heard good stuff awaits me back in town.
Grand Vin, the first wine shop and bar to open in Key West in 11 years, is hosting its Annual Holiday Wine Tasting, featuring more than 40 wines. At this stately, century-old shipbuilder's house, you can watch the characters on Duval Street from the wraparound porch or chat up their equally entertaining bartenders inside. Next it's on to the seventh annual Holiday Historic Lighted Inn Tour that kicks off tonight at the Mermaid and the Alligator Bed & Breakfast. Havana and Caya, two fat-coated retrievers sporting antlers, are the official greeters at the 1904 Victorian home; hors d'oeuvres from theGood Life restaurant make the rounds. And a 10-foot Fraser fir sparkles with a special mix of mermaid and alligator baubles that guests have given the owners, Dean Carlson and Paul Hayes. When a travel-weary, European couple rolls their baggage up to the gate, Carlson rushes over to them with arms wide and says, "Welcome! We threw you a party!"
As I make my way to my next stop, the Conch Train whizzes by on itsHoliday Lights Tour, trailing the harmonies of "Jingle Bells" from the 60 passengers sated with cookies, candy canes and eggnog. Locals, not just tourists, love to jump aboard too. "We like to organize group evenings on the train," says Bill Lilley, a 15-year resident with a British accent. "You bring a little drink-y drink-y, go ooh and aah, and sing carols. It's good fun."
Wiped out and back on Sunset Key, I find Sandra Haslinger from Ohio. She owns a home on the residential part of the island, which makes up two-thirds of the 27 acres, but right now she's hosting 16 family members spread out among cottages. "The six grandchildren love riding the golf carts around the property," Haslinger says. "The lit trees at the entrance are a must-see on their nightly excursions." The concierge team, she adds, makes life easy for her by stocking the kitchens and decorating the cottages and trees. Gifts can be sent down ahead of time so that on Christmas morning, they appear under the tree when the kids wake up.
TASTE OF THE SEA Although Latitudes has typical holiday entreés on the menu, the Estes family opts for a Christmas Day waterside meal that features elements of an old-time Key West spread: including grouper with mango, fruit de mar, crème brûlée and Key-lime pie. For more international favor, Martin's, a 20-year institution on Key West, offers a holiday menu of meats such as veal chop and roasted lamb loin along with German dishes like duck breast Schwarzwald and jäger schnitzel.Antonia's has long been a holiday staple since opening on Christmas Eve more than 25 years ago. Multi- generational families pay a visit each year for the authentic Northern Italian cuisine here, reserving their tables for next year before they even pay their bills. "[The holidays are] about family, and since the beginning, Key West has been known for being one family," says Grob. "I've spent the holidays in many tropical places, and no one does it up like we do." keywest.com
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