Port Douglas began with gold. In 1877 a wharf went up here to service the newly opened Hodgkinson goldfield, west beyond the Great Dividing Range, and for a brief moment the town outpaced its rival Cairns to the south. The advantage did not last. In 1885 the colony chose Cairns, not Port Douglas, as the terminus for the Tablelands railway, and trade drained away. After the line reached Mareeba in 1893 and pushed on to Mount Molloy in 1908, the port's reason for being all but vanished. Port Douglas reinvented itself as a sugar town, shipping cane out through the Sugar Wharf until 1958, the narrow-gauge Bally Hooley train rattling loads down from Mossman. Then the sugar trade left too, and the town settled into a long, quiet decline.

What saved Port Douglas was ambition - and, briefly, money it turned out nobody had. In 1987 the entrepreneur Christopher Skase opened the Sheraton Mirage, a lavish resort of green marble and bronze dolphins built for a reported hundred million dollars, and overnight a fishing village became a stage for the rich and famous. The glamour stuck even when its architect did not. When Skase's corporate empire collapsed in the recession that followed, he fled to Spain and became one of Australia's most notorious fugitives. The resort he built endured, and the reputation it minted endured with it. Presidents and Hollywood stars have stayed here since, and the marina still fills with the kind of boats that draw a crowd.

Geography is Port Douglas's true fortune. Sail an hour offshore and you reach the outer Great Barrier Reef - Agincourt, Opal and Tongue Reefs, where the coral walls drop into clear blue and the dive boats anchor. Drive ninety minutes north on sealed road and you cross the Daintree River into the world's oldest surviving rainforest, with Cape Tribulation, where the jungle runs right down to the sea. Closer in, Mossman Gorge offers cool swimming holes beneath ancient trees, and the Atherton Tablelands rise green and temperate just inland. Few towns anywhere put so much wild variety within a day's reach, and the whole local economy is built on ferrying visitors out to one wonder or the other and home again by dinner.

The town's beating heart is its beach. Four Mile Beach unfurls in a long ribbon of firm pale sand, perfect for a sunrise cycle or a barefoot walk, with the green hump of Flagstaff Hill at its northern end. But this is the tropics, and the water demands respect. Saltwater crocodiles haunt the inlets and creeks, and the beach is closed outright if one is sighted near the surf. From November to May, marine stingers - including the tiny, dangerous Irukandji - drift into the shallows, and swimmers stay inside the lifeguard-patrolled stinger net at the northern end. Beauty here comes with a sharpness, the constant reminder that this lush coast is wild country only lightly tamed.