From Managua, head to Mercado Mayoreo and take any Esteli-bound bus. Once in Esteli, go to Cotran Norte (a short walk north of Cortan Sur, where your bus may have arrived--ask anyone), and take any bus to Somoto. These leave hourly. Alternatively, direct buses leave from Managua (Mercado Mayoreo) to Somoto less frequently.
From Choluteca (Honduras), take any bus to San Marco de Colon, take any frontera-bound bus, then transfer to any Somoto bus once you cross the border.
Coming from Managua, you'll end up in Somoto's bus station. To get to the centro, cross the highway and walk four blocks south. The central park will be one block to the right, next to the church. At night, you may want to hop in a taxi.
Somoto is a small city, and most destinations can be reached on foot. A taxi (20c or $1 per person) can be used for outlying destinations that aren't accessible by bus.
The Mirador on a hill on the northeast side of town offers a great panorama of the mountains that rise 300m above the town. The cost is 10c per person, in addition to 20c per person cab fare.
The Canyon de Somoto is the big tourist draw.
The canyon is 200m deep, with sheer 100m cliffs falling straight to the water. At some points, it is only a few meters wide. The canyon is dramatic and beautiful with rock formations and wildlife.
The canyon can be explored with a guide or alone. In either case, make sure to bring sandals with you, as the stones on the bottom of the river can hurt your feet. Be aware that at the height of the rainy season (September/October), the trip may be impossible due to the current.
Exploring the Canyon Without a Guide
Typically, guidebooks describe the process for getting to the bottom of the canyon. Taking the bus to the border (El Espino) from Somoto, tell the driver you want to go to the Canyon and keep a lookout for a sign. You will be dropped off at the top of a road. After a short walk down a dirt road, you will come to a gatehouse where you will be asked to pay a fee. Continue down the road for about 10 minutes until you reach the river. Cross the river and continue down the road. Follow the road upriver until you reach a place with some boats parked. This is the bottom of the canyon.
Once you reach the boats, look for someone to pay to take you upriver a ways. You will be taken as far as the boat goes, at which point you will come to a place with some inner tubes. You can swim as far upsteam as possible from this point, exploring the bottom portion of the canyon. Be careful, especially if you don't have any lifejackets. Certain portions of the canyon are deep, and distances can be far for people not used to swimming. Be aware that you will be swimming most of the way; walking on the side of the river is rarely an option. As you get further upstream in the canyon, the obstacles you have to climb will get more and more difficult. After you've had your fill, turn around and go back to the bottom.
Exploring the Canyon With a Guide
Hiring a guide will give you a somewhat different experience of the canyon. Although certain guides could simply accompany you on a trip similar to the one described above, others will take you on a more thorough trip. This trip involves using another entrance to the park further upstream, then going downstream through the entire length of the canyon.
It is not advisable to attempt this trip alone. It is difficult to find the top of the river where the trip starts, and the guide must sit on an inner tube keeping your possessions out of the water.
Before buying any guide's services, make sure of all of the following:
(1) Your trip will be through the entire canyon instead of starting at the bottom (2) Life jackets are included (3) An inner tube will be provided to keep your possessions dry
Transportation To and From the Canyon
The canyon can be reached by taxi or by chicken bus. The chicken bus costs 6c ($.30) each way, and the taxi is perhaps 2-3 times as much. Normally, transportation is not included with the fee for a guide; in fact, you need to pay for your guide's transportation as well.
The Mercado Municipal de Somoto is the main shopping center. It is a very clean market, but is geared more towards locals than tourists. The Hotel Panamericano has tourist items for sale.
There are many comedors close to the main plaza such as Comedor la Soya located on the south-west corner of the central park or Comedor la Fogata, located 2 blocks south of the central plaza. Comedor Familiar, a great comedor serving breakfast, lunch, and dinner, as well as drinks at night, is located just south of the Hotel Colonial, a half block off of the main street on the left. Full meals cost between $1 - $4.
There are two expensive restaurants close by the south- east corner of the market. Comida Tipica sells upscale and quite good versions of Nicaraguan food and a fancier restaurant right around the corner of hotel colonial sells the only real steak in town. There are a few pizza carts next to the Parque Central.
Cafecito sells light snacks, coffee, fresh juices and smoothies using purified water. They can be found across from the town hall, 2 blocks south of the south-west corner of the market.
Cafetín Cuá has relocated to Matagalpa
Not much of a nightlife in this small town. The town has two bars, Bucanas, next to the Hotel Portal del Angel and an out-of-place bar/disco Danceoff. Thursdays you'll find Karaoke in Bucanas and Saturday there may be some dancing in both.
Any other day of the week it is pretty much dead. The backroom of Comedor Familiar is sure to have some locals sharing 1L beers (40c or $2).
There are three main hotels in town.
The Hotel Panamericano is located on the north side of the Parque Central, with a pretty garden, restuarant, and store. For $8-10 per person payable on check-in, you get a room with fan, private bathroom, TV, and refrigerator. Unfortunately, some rooms are dungeonlike and lack furniture, and bathrooms can be bleak. Ask the staff to show you several rooms. In addition, the staff might seem a bit relentless trying to get you to do a tour or eat in the restaurant. Internet is shut off between 9.30pm and 6.30am no matter how much you plead with staff.
The other option is the Hotel Colonial, a more upscale hotel. This hotel costs $25 per room for two people, and includes a good tipico breakfast. Although the amenities are almost exactly the same as the Panamericano (except for lacking the refrigerator), the rooms are more pleasant and comfortable, with nice furniture and set around a pretty courtyard. The foyer and lounge have a formality that would befit a nice property in Granada or Leon. There has been incidences of clothes and personal items going missing from rooms. Located just south of the central park on the main road.
Portal del Angel, located 4 blocks south of the bus terminal and 5 blocks from the main square, has 12 comfortable rooms accommodating between two and up to five people per room. They serve a typical breakfast and are located next to one of the only bars in town. The staff are professional and informative and the premises are clean and very safe.
If anyone recommends Hotel Rosario, be wary. They don't honor reservations even if you called and confirmed and are no help in trying to find you anywhere else to stay.
Across the street Hotel Oriental offers very basic rooms with bathroom starting at $10.
In addition, the are a couple basic hospedajes in between the bus station and the centro.