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Spring and Autumns are perhaps the best times of the year to visit Madrid. The weather is mild and the air is crisp. But the two seasons present some differences that you may want to consider when you are planning your trip to the city.
During Spring, that goes from March through May, the days are warm, and the nights, cool. Unlike Winter, people swarm into the streets for the popular "marcha" (the walking across the city, stepping in bars, chatting on the streets, having fun outdoors). A good time to visit Madrid is Holy Week when madrilenos leave the city on vacation. There is some rain and some wind, but it is generally OK.
Autumn (September through November) marks the beginning of the school year and people return to work after the August holidays and there are lots of cultural activities. The days are very enjoyable compared to August high temperatures (although being a dry city with little rain, condition that makes the heat no that oppressive, it can be really, really hot).
In Winter (December to March), there are not so many tourists and it can be a good time to visit if you don't mind some snow and some cold (temperature can go below 0). It is low tourist season and you will find great bargains at hotels and trips outbound Madrid.
And the feared Summer (June through August) is not so bad as publicized. It has a kind momentum in June, and a harsh one in July and specially August. June is the best! Nights are warm and long and you can really enjoy the party atmosphere on the streets. But, July brings temperatures that hit the 40's (over 100 Fahrenheit) and it doesn't cool down very much at night. One good thing is that madrilenos leave the city for their yearly long vacation and there is less traffic, although some restaurants close, the open are less busy and you can appropriate the city in a more leisurely way.