Tarakan  is the capital of North Kalimantan on an island of the same name formerly a town in East Kalimantan. 100km south of Nunukan, it also serves as a visa-free border-crossing between Indonesia and the Malaysia town of Tawau in Sabah.
To/from Tawau: One departure daily except on Sunday from Tawau. M.V. Indomaya sails every Monday, Wednesday and Friday at 11.30am, while M.V. TawindoM.V Labuan Express departs every Tuesday, Thursday and Saturday at 10.30am. Tickets cost RM130 to RM140 (depending on which ferry you get on) one-way and travelling time is 4 hours (and thats not counting the usual 1 hour delay in departure time).
In Tawau, the ferry docks at the Customs jetty behind the fish market,mdown the lane by the Shell garage. In Tawau, the ferry docks at Tengkayu port, which is close to the city center. The jetty, in this case, is a short walk along the dock to the customs/immigration building. The minute the ferry docks (at either port), a crowd of porters will jump on board and hustle for your business to take your bags, but will stand down when you tell them so.
Porters are available to haul your bags for you. On the Malaysian side, RM10 should be sufficient, on the Indonesian side about 20,000-30,000 rupiah for a couple suitcases.
Alternative travel : You can also travel to Tarakan via the ferry service which plies a few times a day between Nunukan and Tawau, and a twice daily flight that goes between Nunukan and Tarakan. To get into Tawau this way, take the 11AM ferry (which usually waits to depart until it's full, which can mean it leaves at noon) from Tawau to Nunukan. The Labuan Express is the best option because it is just plain cleaner than the other ferries. The journey will take 45 minutes to an hour and it costs 40 Ringgit. After getting through Indonesian immigration, catch a minibus (RP 20,000 to charter the whole thing, and be prepared to bargain) to the airport which is a mere 15 minutes drive. There's a Kalstar plane (French ATR propellor plane which can seat 50 people) that arrives at 1:30pm to 2:00pm and you can catch that to Tarakan. Its RP 250,000 for that ticket which you can purchase at the airport. Oh, and there's some other tax of RP 8,000 too. The journey takes less than 15 minutes.
Of course you can travel to Tarakan from the Indonesian side (mainly going through the oil city of Balikpapan). From Balikpapan there are three to four flights daily except Sundays. By the way, if you do choose to go through Balikpapan airport, try the "Nasi Sop Buntut" at the Blue Sky restaurant on the second floor of the airport. Right beside the viewing gallery. Excellent stuff. Probably the best in Kalimantan ...
You can walk about 5 minutes and get to the main street where you will find food, accommodation and travel agents, etc. Blue mini van take you around for 3,000. Though they can change up to 20,000 to go to the airport.
Taxi vans meet you off the boat at the ferry port. Charged 100,000 for 4 people to the city centre but ripped us off, 50,000 is maximum you should pay.
If arriving at the airport it may be worth having your hotel pick you up as the airport taxi drivers are not always licensed and can make the short drive into town rather unpleasant.
On the face of it, there appear to be no sights worth bothering with, Tarakan is really just a transit hub for many. However, there is an incredible walk through a local park built atop mangroves only a 5 minute walk down the road from the Swiss Bell hotel. Walking atop a wooden, elevated path, one can see proboscis monkeys, mudskippers, and any number of rare bird and reptile species. It only costs 5000 IDR for foreigners to enter. Additionally, for the adventurous, a meandering exploration of the riverside stilt town is a colorful and interesting side trip.
The island was also the site of two major battles during World War Two, one in 1942 and another in 1945. On the side of a hill to the south of the city there are a number of bunkers and gun emplacements which can be visited for free. Most of the bunkers can be entered although some are flooded and/or locked. From the top of the hill there is an excellent view of the city to the north and the harbour to the west. If the weather is clear the mountains of Kalimantan can be also be seen. There is also a well-preserved pillbox near the MAF hangar at the airport.
A few other WW2 sites include the Wash Tank (a huge oil tank that received a direct hit from a bomb), two monuments (one Japanese and one Australian), and a small museum showing a few artifacts and pictures from the battles. While none of these are particularly spectacular, they are worth a look if you have the time.
There is also a small park with a "waterfall" near the city. The pictures show a small natural waterfall, but it has since been fixed with a big concrete wall. This part isn't really worth visiting but if you explore some of the trails around the park you can get out into some nice little hillside farms. The people here are extremely friendly and happy to see you come up out of the woods.
The huge mosque on the edge of the city is also worth a look. On a sunny day it is quite an impressive sight when driving up to it. The imam is generally happy to show you around the mosque.
The SwissBel has a good book with pictures of the various tourist attractions in Tarakan and it is a useful resource.
Tarakan is actually one of the best places for accessing the more remote and few remaining authentic parts of all of Borneo (not just Kalimantan). Access the remote interior villages for challenging jungle trekking, interesting villages and primary forest. For intrepid and prepared travelers only (which, if you are in Tarakan in the first place, you very well may be). Head to the airport and talk to "MAF" the Missionary Air Fellowship, and hitch a ride on one of their 4 seater planes for rides into the interior. Expect breathtaking scenery and dodging mt peaks before landing on jungle mud next to roaring rivers and in between trees. It's a real experience. Warning: NO ONE WILL SPEAK ENGLISH. Get a phrase book and be prepared to work with the incredibly friendly locals to get access to remote and abandoned research stations in the jungle. Escape the jungle via hitching on speedboats heading down river on 10-12 hour rides back to the coast. Warning: Leaving Tarakan for the interior should only be attempted by prepared, fit, intelligent and hardy travelers looking for a real adventure. It's not easy to get in, and it's harder to get out. But worth it!
Tour guides also offer tours into the interior. While you can certainly organize everything yourself, having someone with you who can speak Indonesian can really improve the experience. The tour guides do have advertised packages, but are extremely flexible with both the number of people on the tour and the number of days in the jungle. A typical tour starts with a ~3hr boat ride to Malinau followed by a ~1hr truck ride to Setulang. You will spend a night or two in Setulang discussing the history of the village with the locals (much easier with a translator) and exploring some nearby farms. Large groups will stay in the cultural building in the centre of the village. Small groups or lone travellers can opt for a homestay which is a great experience. Another ~1hr drive takes you out to Tana Olen (sometimes written Tane' Olen), the forbidden forest of the local Dayak people. This is a large area of primary rainforest that is protected by both the Dayak people and the Indonesian government. There is a small base camp with bunk beds set up on the side of the river which is where you will stay for the bulk of your trip. Points of interest include a lovely waterfall about 30 min from the camp that has a nice pool for swimming, a ~3hr hike to the largest tree in the Malinau regency (make sure you're prepared to deal with leaches), and night walks looking for various nocturnal species. There are few tourists that make it out even this far so it is definitely a fantastic experience.
Tarakan is also a jumping off point for trips to Derawan Island. A ~3hr boat ride takes you to some fantastic snorkeling and diving locations. Of particular note is the lake in the centre of Kakaban Island where you can swim with stingless jellyfish.
The Grand Tarakan Mall is unfortunately more frightening than interesting. There are only a couple of stores inside and it is generally poorly lit and empty.
There don't appear to be any of the typical Indonesian convenience stores such as Alfamart and Indomaret in Tarakan. There are plenty of locally owned stores all over town.
Adjoining cafe next to Hotel Mutiara, great variety of local and western food at cheap prices
KFC in city centre
Mr Crab seafood restaurant on main road near airport
D'Boss Cafe - a great atmosphere and good western food including some excellent pizza
Milo 21 (aka B21) - an excellent restaurant with great local food. Get the koloke (sweet and sour chicken) or the ginger beef, both with a side of rice.
Happy Cafe - A short walk towards the airport from the SwissBel. It has a limited variety of food, but the meals are good and fairly cheap.
If you're looking for beer head to Nu (directly across the street from the road into the airport). It has a good variety including Bintang (both the beer and the radler), Heineken, Guiness, and Crone, all at reasonable prices.
Budget: There are a few budget options close to the ferry port.Once you reach the main street from the ferry port Walk 500m to the left or right (more options right) for Budget hotels and Losmens.
Note that while there is little tourism in Tarakan, the nicer hotels such as the Milia or the SwissBel are often full.
Hotel Mutiara - very nice budget option suitable for backpackers, good value for money, a little hard to find so ask a taxi driver. Located near the airport, and 3 miles from ferry port. 200,000 rupiah for an economy twin or double with detached bathroom, slightly more for en-suite. Wifi and breakfast included, cheap but good cafe next door, karaoke bar nearby (complete with friendly prossies), as well as Supermarket, ATM and 'Blueberry bakery'.
SWISS-BELHOTEL - the hotel of choice for most business travelers. Expect to pay from between 450,000 Rp to 750,000 Rp net per night. Clean and centrally located.
Tarakan Plaza Hotel - newly renovated and just re-opened for business. This is one of the oldest hotels in Tarakan and it used to be the best. But that was 10 years ago. Today it's been redone from the outside in. Unfortunately it still can't shake the "old & dark" feeling that old and dark hotels have. Room rates are from 280,000 RP per night.
Bahtera Hotel - another oldie but this hotel has a little bit more character. Another member of the old and dark hotel club, but its saving grace is its gardens and low density lay out. It also has an infamous massage parlour, an ear-drum wrecking dance hall, and dingy karaoke rooms complete with hostess viewing "aquariums".
Samkho Hotel - somewhat old and dingy, but reasonable in price (270,000 Rp or so).
Grand Taufiq Hotel provides three types of Room with different features. There are 45 rooms incuding 3 Executive rooms, 12 Deluxe rooms and 30 standard rooms which completed with lift, minibar, coffee shop, meeting room and also television channels. Below is the room's rate that Grand Taufiq Hotel offer. Grand Taufiq Hotel located in the middle of Tarakan, it takes few minutes to reach the harbor, airport and center of trading. Therefore, you may continue your journey easily to Nunukan, Bulungan, Malinau, Berau, Derawan island and also Tawau (border between Indonesia and Malaysia).contact Suri(manager): +6285350296824
If you are flying don't forget the 30,000 for airport tax that has to be paid at the airport before boarding. It's not included in the ticket regardless of what the travel agent may tell you. This does not seem to be the case when flying Garuda.