Nagorno-Karabakh is a landlocked region in the South Caucasus, lying between Lower Karabakh and Zangezur and covering the southeastern range of the Lesser Caucasus mountains. The region is mostly mountainous and forested and has an area of 8,223 square kilometres (3,175 sq mi).
The territory is internationally recognized as part of Azerbaijan, which has not exercised power over most of the region since 1991. Since the end of the Nagorno-Karabakh War from 1988 to 1994, representatives of the governments of Armenia and Azerbaijan have been holding peace talks mediated by the OSCE Minsk Group on the region's status.
On December 10, 1991, as the Soviet Union was collapsing, a referendum held in the NKAO and the neighboring Shahumian region where overwhelming majority of residents voted for independence from Azerbaijan and the establishment of the Nagorno-Karabakh Republic. The country remains unrecognized.
Since the ceasefire in 1994, most of Nagorno-Karabakh and several regions of Azerbaijan around it remain under the joint Armenian and Nagorno-Karabakh military control. Representatives of the governments of Armenia and Azerbaijan have since been holding peace talks mediated by the OSCE Minsk Group.
According to the US Department of State's travel warning: "As a result of continuing conflict, travelers are cautioned to avoid travel to the region of Nagorno-Karabakh and the surrounding occupied areas." In spite of that, thousands of American and European tourists visit Nagorno Karabakh every year.
The only country you can currently arrive in Karabakh from is Armenia (this is considered illegal entry into Azerbaijani territory by Azerbaijani authorities). The vast majority arrive by automobile via the Berdzor (Lachin) Corridor, though driving through the Karvajar (Kelbajar) pass or helicopter are alternatives.
To enter the self-declared republic of Nagorno Karabakh, you have to obtain a visa from the authorities at the Embassy of N.K. in Yerevan, Armenia. Visas cost 3,000AMD (roughly $10) and are valid for 21 days after issue. Here is the visa application in English (don't forget to add a 3x4cm picture): . The embassy is located at 17-A Zarian St and is open for visa applications Mon-Sat 9a-5p. You now also get your registration paper at the embassy, so there is no longer a need to register with the Foreign Ministry in Stepanakert. It is also possible to obtain the visa upon arrival at the Foreign Ministry in Stepanakert, though this may not be a safe bet unless your Russian or Armenian is good enough to explain to the border guard that you will get one as soon as possible. For this kind of registration a picture is not necessary. (This information is current as of July 2011.)
The sole civilian airport in Stepanakert, Nagorno Karabakh is currently undergoing reconstruction, after it was damaged & nonfunctional since the Nagorno Karabakh War in 1991. It will reopen its doors in May & flights between Armenia's capital Yerevan & Stepanakert will be launched. A round-trip air ticket from the Armenian capital to Stepanakert will likely cost between 18,000 and 21,500 drams ($50-60). 
Currently there is no working train line between Yerevan & Stepanakert.
If lucky, you may be able to convince a taxi driver to drive you to Stepanakert, otherwise many taxi drivers in Stepanakert might be willing to drive you back to Yerevan, if you're with a few friends for something like $80-$100 U.S you can organise the travel. The embassy in Yerevan offers Drivers to take you there and back, and to take you to the biggest attractions. This costs about $100 -$150 dollars per person.
There is one daily bus from Yerevan to Stepanakert, which is relatively cheap, but takes forever (or at least it seems so).
There are also many tour companies or agencies, which provide guided tours to Nagorno-Karabakh (Artsakh in Armenian), you may also hire out a Mini-van which will take you and your friends to the capital Stepanakert.
One way to see much of Karabakh is simply to walk from one end to the other on the Janapar . There is a marked trail which is broken up into day hikes which extend for 2 weeks of hiking. There are side trails and alternative routes as well. Trails take you to ancient monasteries and fortresses, through forests and valleys, to hot springs and villages. Each night you can either stay with a village family or camp out.
All cities are small and fairly safe, so it is best to walk around the few cities in NKR. Not only will you save a little money, but you will get a good sense of the region and its people.
If you plan to travel to Karabakh from Yerevan, there are several car rental agencies that provide cars that also can be driven into NKR - given that you are comfortable with the rather crazy Armenian traffic.
Taxis are available in most cities, with a new North-South road across the NKR making for a smooth and quicker (than you'd expect) ride across the region. These cost about 120 drams/km within a town, or 150 drams/km if you take the cab out of town.
Marshrutkas are available, but they may not run as often as in Armenia. There is no train or rail service. A recently restored airport for Stepanakert-Yerevan flights is yet to enter service.
If your Armenian or Russian is good, you may be able to hitch a ride for less than a taxi (although don't pay too much less, as these are certainly not affluent people), and you could very easily be invited for dinner with them (in which you should have some gift, especially wine, coffee, or chocolates, and do NOT offer money) as the people of NKR are doing this out of hospitality.
Armenian and Russian are both widely used. Karabakh Armenians speak a dialect of Eastern Armenian that differs slightly from Armenian mainly because of the inclusion of many Russian words. A good amount of the Population speaks Azeri but it is never heard and becoming forgotten. Very little of the population speaks English so it is wise to travel to Karabakh with a guide or translator from Armenia.
There are several Tourist/Souvenir Stores within Stepanakert. A great idea is to buy a Rug made in Karabakh, they are known for their Ancient rugs, it is said that many people in the region and bordering countries learnt rug making from the Ancient Armenian of Karakagh.
Many Mulberry trees are to be found, but ensure you are eating only ripe fruit (dark red) and not unripe fruit (whitish), as unripe fruit as well as the green portions of the tree contain a white sap which is intoxicating and mildly hallucinogenic.
Tutti Oghi — Mulberry Vodka, which Karabakh is famous for, often reaching 80% alcohol, and with a distinct taste.
Limitless volunteer work for the willing. Incredibly low cost of living. The government will gladly give most people land as long as they are willing to farm and tend to it.
Don't venture east of the Mardakert-Martuni highway, where the ceasefire line is located. Otherwise, it is very safe to travel around and interact with people. When you first arrive in Karabakh, you must go to what is called the "MIT", the Stepanakert foreign affairs office, to get your travel papers. This will prevent any confusion if one gets pulled over or stopped by local authorities.
If you are planning to hike, be in rural areas, or stay on the outskirts of cities note that the area is inhabited by bears and wolves. While they will not attack if unprovoked, practice bear safety and walk away slowly if unexpectedly approached. If you are planning to hike, the Janapar trail has been broken into day-long hikes and it is best to take advantage of the homestays offered rather than to camp alongside the trails. If you do camp, make sure to keep your food high in a tree and a few dozen meters (a hundred feet or so) from your tent and do not simply sleep on the ground or in a sleeping bag...sleep inside a tent.
While the region is fairly safe in terms of crime, you must not lose your passport. There are no foreign embassies in the NKR, and you may have a hard time entering Armenia without a passport or visa. The US embassy in Baku says that "because of the existing state of hostilities, consular services are not available to Americans in Nagorno-Karabakh." It would be safe to assume that this applies to all other nationalities and their embassies in Baku.
Drink bottled water if you are not accustomed to the local water. However if you are hiking, drinking water in mountain streams and ponds in reasonably safe, as long as you are sure it is not downstream from a large town (in which case it is likely contaminated with chemicals, street runoff, and/or waste.
Remember that this is a rural region, and in the event of a medical emergency the hospitals in NKR are no more than a modest clinic. The nearest major hospital is in Yerevan, a long distance in the event of a heart attack or complications with any medical problems you may have. It is best to have with you a small first aid kit with bandaids, bandages, anti-biotic cream, ibuprofen, and any other medicine you may need.
The people of NKR are very friendly and inviting, and if your Armenian or Russian is good enough, you will easily meet people who will invite you to their house for dinner (and some will even harass you until you accept). Unlike many parts of the world, you should not worry about your safety, no matter how much they harass you, and accept their invitation. Even though these people do not have much and, like many persons in developing countries, view westerners as rich, they will vehemently refuse any type of money given to them (although you may find luck saying it is "for the children"). However, do not show up empty-handed! You will be expected to bring some sort of gift, with food (wine, chocolates, coffee, etc) being best. You should also bring something to show/give them from your home country (postcard, book, photos, etc) to have a conversation or at least get their interest. You never know, they may likely have family in another place and what you thought was just dinner could turn into inviting you to other family's businesses (discounts), homes (to stay the night), or another meal.
The wiki on the Janapar trail recommends no trace camping and if you bathe, make sure no locals are around (it may be offensive). Just as stated above, you will receive offers of food and rest. Have gifts for such people, but do not offer money.
Avoid disussing Azerbaijan, because due to the frozen but still ongoing very bitter conflict with Azerbaijan over Nagorno-Karabakh, it is an extremely sensitive subject.