My wife and I spent two nights at El Ladron de Agua and it was one of the highlights of our two weeks in Spain.

We took an early morning flight in from Barcelona and arrived at El Ladron at about 8 AM, before anyone in Spain is awake. The hotel host was waiting for us and had an excellent hot breakfast already waiting in the basement kitchen/dining room. Our room was ready for us to clean up and get on with our wonderful day in Granada.

Granada is a magical city and worth a long visit. The Alhambra is one of the best sights in Spain. The food here is good and the people are very pleasant. Our experience in Granada was made better by our stay at El Ladron.

The hotel is hidden on a cobblestone road off one of the main squares. The main doors hide a treasure. Walk in and you are inside an oasis where the light streams into an indoor courtyard. The rooms surround the courtyard. All is quiet. It is like a haven from your travels in Granada. Our room was large, clean and well appointed. The decor feels very authentic, with exposed wood beams and old furniture. The bed was comfortable.

The food at El Ladron was great. The staff prepares a nice breakfasts in the morning and you eat in the basement dining room. Nothing fancy, just good quality - fruit, granola, yogurt, coffee and tea are a good way to start a day of sightseeing.

I cannot recommend this hotel enough. We cannot wait to go back.

We stayed in Ladron de Agua in August 2007 during our three week travel in Andalusia and we consider it the best hotel we found(more than a couple of 4/5 star rated hotel, much more expensive!).
The service and the rooms were excellent, and the breakfast too.
We lost our baggages (do not fly with Vueling!) and they were extremely kind and help us to solve the problem.
Definitely, a place in which we would return.

A terrific location in the most picturesque part of town, and an easy walk to all sights (even the Alhambra, around 15 minutes, straight uphill, on foot). We liked the "medieval Islam meets modernity" decor in the rooms and the public spaces, though this is not a typical Andalusian hotel by any means. But if you are looking for something a little more chic (read: Barcelona or Basel, not Seville) this might be just the ticket -- the marble foyer is striking, as is the dark wood in the bedrooms. Our only real complaint was the breakfast: around 10 euros for a lousy selection of rather stale bread, and only one cup of coffee apiece (when I begin eating dinner at 8:30pm, as is customary in this part of the world, I am certainly going to need that extra cup...) So, caffeine addicts aside, I'd recommend this hotel on the basis of a terrific location and a rather off-beat, elegant feel. Just don't try to drive here -- the street it is on is so narrow that even if you find it (a big if, even for master map-reades) you won't be able to park. Drivers should park in "new" Granada and take a cab (it should cost no more than 5 euros).

Have just returned from a 2-night stay in El Ladron and have to say that I was somewhat disappointed - it was the most expensive of four hotels stayed in on this trip and offered least. The staff are absolutely excellent - friendly, informative and helpful but there are just not enough of them, in small hotels like this I don't expect room service but over two days I didn't see anyone having so much as a glass of water in the lobby/library areas - these are very nice public areas but because there are no services available just don't seem to be used. I'm sure hotel management will point out the presence of a small cafeteria/bar area but when it's unstaffed and the only person available is on reception and dealing with phones & guests it seems unfair to request coffees/drinks. A minibar in the bedroom might have alleviated this somewhat but there wasn't one.
The bedroom, el regreso, was pretty nice furnishings-wise but you could hear absolutely every word said by the people in the room next door. And when they used the hydromassage bath I thought a drill had gone off on the road outside... Also, the bedroom was quite small for the price - we had two suitcases but nowhere to store them and they and our various toiletries scattered around pretty much ruined the boutique look.
This place is aesthetically lovely and with very nice staff. It's in a great location. But I really think it's too expensive and should be more properly categorised as an upmarket guest house. Basically my expectations, from both the hotels website and the reviews of others given below, just weren't met.