Spectactors watch a daring diver leap from the rocky cliffs at La Quebrada. (SUN/Donald L. Telfer)

ACAPULCO, Mexico -- Dangling from a throttle on the bridge, the cellphone never stopped ringing as the yacht cruised across Acapulco Bay.

\"Great way to do business,\" said the smiling bronzed skipper as he returned the phone to its berth.

Dressed in shorts, sneakers and oversize eyeglasses, the jovial president of Acapulco City Council was more interested in describing his gorgeous playground than talking shop. Jorge Ochoa, who also is a prominent Acapulco lawyer, is especially proud of the American University of Acapulco. It often brings in guest lecturers such as the charming Yvonne Stinson of Mexico City, an economist who helped negotiate the North American Free-Trade Agreement.

\"This is a good time to invest in Mexico,\" Stinson told a New York woman who is considering buying a condominium.

\"The economy will get better but it will take time,\" she assured the woman, who repeatedly praises this extraordinarily beautiful resort city.

Movie stars

Acapulco has long been admired for its beauty, and especially its ace in the hole -- guaranteed sunshine. The sunshine may be Acapulco\'s trump card yet it took movie stars like Hedy Lamarr, John Wayne and Elizabeth Taylor to lift Acapulco from obscurity to international prominence.

Back in its trading days, Acapulco was a sleepy fishing village when the Spanish conquistadors arrived in the early 1500s. The Spanish established a shipbuilding centre, and made Acapulco the crucial link in the trade route between Spain and the Philippines. To protect the deepwater port from pirates, Fort San Diego was built in 1617.

Acapulco continued its prominence as a port and take-off point for Spanish colonizers, including Sebastian Viscaino, who discovered California. It was years later before California found Acapulco.

Band leader Teddy Stauffer introduced his glamorous wife Hedy Lamarr to Acapulco in the 1940s. Rita Hayworth\'s Lady Of Shanghai was filmed here as World War II ended, the publicity attracting honeymooners Elizabeth Taylor and Mike Todd, and John and Jackie Kennedy. John Wayne started hanging out at the Los Flamingos Hotel, perched up on the cliffs behind La Quebrada where the daredevilry young cliffdivers perform to this day.

The idyllic splendours of a hotel terrace high up on a hillside was my Acapulco hangout. Overlooking Acapulco Bay, Las Brisas is a resort renowned for its private pools and fleet of pink and white Jeeps, which shuttle guests to their secluded casitas.

The view of Acapulco from the poolside terrace can drive a visitor daffy: Graceful palm trees, the sloping Sierra Madres, boats cruising across the aquamarine water and the horseshoe of uninterrupted golden beach that has Oscar written all over it.

It wouldn\'t be difficult to camp out here until the next Academy Awards but move on one must. Down at the naval yards where a four-master prepared to set sail is the start of the12-km-long strip, The Costera. The broad Costera is a beautiful tree-lined runway of towering palms, hugging the coastline with shops, restaurants, discos and hotels. The golden beach is an open-air performance where you can join in the water activities or enjoy the non-stop activity from a seaside restaurant.

An entertainment bargain is the weekly bullfight. The season runs from Christmas to Easter, the stylish matadors testing their skills Sunday afternoon at the Plaza Caletilla. The duel between life and death can be a gruesome sight for the uninitiated as the maddened bulls are teased, taunted and speared with the colourful banderillas.

The fierce power of a galloping 18-wheeler was demonstrated on the day I witnessed my first bullfight when a matador on his knee, tickling the tonsils of the bull in a daring cape pass, was caught by one of the bull\'s huge horns and thrown high into the air like a rag doll. The slim young matador lay deadly still for several long seconds, then suddenly jumped up to the thrill of the aficionados. He dusted off his backside, limped back into the centre of the plaza, and with poetic grace crippled Mr. Bull with the deadly sword.

\"Ole!\" the crowd exploded with delight. \"Ole!\" As the band played a frenzied bugle cry, the matador paraded around the ring while senoritas threw flowers, hats and romantic offers to the cavalier young man.

An American boy sitting next to me asked his father: \"Dad, does this really help the economy of Mexico?\" His father, who had been describing the national pastime with the cold precision of a forensic anthropologist, was at a loss for words.

Ancient customs

The ancient customs of Mexico are highlighted at the Fiesta Mexicana, held Monday, Wednesday and Friday evenings at the Acapulco Convention Centre. The open-air performance includes colourful dancers, lively mariachi bands, and five death-defying men from Veracruz who climb a 45-metre pole, then dramatically descend in an Indian flying dance without a safety net.

Following the spectacular show, I enjoyed a candlelight dinner at a restaurant that could have been a Hollywood set. The open-air Coyuca 22 has been an Acapulco fixture since the days of Elizabeth Taylor\'s earliest beaus, providing guests with a magnificent view of the bay and cruise terminal. We toasted the loveliest Mexican goddess, the God of 400 Rabbits, as the Crystal Symphony prepared to depart, its glittering decks illuminating the bay in a romantic scene right out of The Love Boat.

Most people cruise home after a long day but not in Acapulco -- a new day begins as the discos start rocking at midnight. I explored a few of the pulsating party palaces, including Baby O, Fantasy and Extravaganza. An after-hours bullpen for the great matadors of the night, the dynamite discos feature dazzling light shows that explode to the beat of the deafening music.

\"Stick around,\" said Julie Mendez, a Californian-turned-Acapulqueno, \"we\'re not paying the band.\"

I crashed long before the last tango in Acapulco, the boom-boom-boom dancing across the terrace into my open-air casita. As the sun rose a few short hours later, the Mexican Navy took over the nightly thunder, their morning bugle call marching in another glorious day in this gorgeous gem of Mexico.

LOCATION: Acapulco is located about 400 km southwest of Mexico City on the Pacific coast.

GETTING THERE: Several airlines offer flights Pearson International to Acapulco.

POPULATION: About 2 million. The most popular destination in Mexico, Acapulco attracts some 1.5 million visitors a year.

DOCUMENTS: Valid passport.

CURRENCY: Mexican peso.

WHERE TO STAY: Hotel Howard Johnson Maralisa, El Esclavo, call 1-800-446-4656. Hotel Majestic, Pozo del Rey 73, call 832-885. Hotel Sands, Calle Juan de la Cosa 178, call 842-260.

INFORMATION: Mexico Tourism Board, 2 Bloor St. W., Suite 1801, Toronto, ON, M4W 3E2. Call 416-925-1876 or log onto www.visitmexico.com