Costas the muleteer had been tanned the colour of tobacco by fifty years of Mediterranean sunshine, and as we clopped up the 580 cobbled steps from the jetty at Skala Firas he mused on some of the changes he had seen in his lifetime. “Ah, you’re English. Good – the English are very generous.” He scratched the mule between her long ears. “She is a good mule, but she’s getting old. She is always hungry, and sadly I am a poor man.” Inevitably this prompted cries of dismay from the group of ladies who had docked with us, and they began rummaging in their purses. Costas saw me laughing at this blatant piece of manipulation and gave a roguish wink. As we ascended I looked up to see a line of whitewashed houses spreading out across the cliff tops like snow – Thira, the main town of Santorini.

Thira teeters precariously on the edge of one of the world’s most dramatic settings, a jumble of picturesque houses and small churches with bright blue domes stretching out along the rim of a vast volcanic caldera 1000 feet above the shimmering Aegean Sea. In 1650 BC a cataclysmic eruption blew apart the island, with most of it sinking beneath the waves, making it a likely setting for the legend of the lost city of Atlantis. As we came to the top of the steps we entered a labyrinth of winding streets, past houses with wide outdoor staircases leading to rooftop gardens and swathes of brightly coloured bougainvillea draped across the gleaming white walls. On one sunny doorstep a bundle of kittens yawned and stretched, and we eventually found the guesthouse, a small whitewashed cottage with pots of basil decorating the windowsills, tucked away up a narrow side street. Sitting down on the bed with the sound of the sea in my ears, still rising and falling from the ferry, I fell asleep.

The muffled sounds of the town began to filter through the thick stone walls as Thira came to life again in late afternoon when the heat of the day subsided. The bright blue wooden shutters slatted the amber light into bars of shadow on the floor, and I could hear the languid cries of shopkeepers echoing along the streets, the falling notes in a pleading descant like birdsong. Wandering up to a taverna with an imposing view of the caldera, we had drinks and a local meze of olives and cherry tomatoes. The menu advertised Fish and Chips with ‘bees’, but I settled for the spanakopita, a kind of spinach and feta cheese pie. We watched the houses turn gold in the setting sun, and as night fell lights sprang up along the ridge like strands of flung jewellery glinting in the darkness.

In the morning we set off towards the pretty village of Imerovigli, perched on a headland overlooking a bay of deep ultramarine blue. From here a path travels along the edge of the cliffs to the town of Oia, 12km away. Walking along the trail there was the scent of rosemary as we crushed wild herbs underfoot, and the dramatically sheer cliffs ahead had scalloped edges like giant bite marks taken out of the island. Above the chorus of cicadas it was just possible to make out the faint hush of the waves carried on the breeze as they broke on the rocks below. The trail snaked onwards around the edge of the ancient caldera towards Oia, a symphony of blue and white buildings that spilled out across the cliff top and down the steep slopes.

In the streets old women shuffled along in carpet slippers, and we passed a priest in a stovepipe hat and impressively large beard chatting to a group of children. Occasionally there was a gap in the buildings revealing a glimpse of the island of Thirasia lying just out to sea. Finding a small taverna we ducked into the cool interior for a lunch of stuffed vine leaves and tomato keftedes – the house speciality. As we ate a cat curled around our legs and there was the clack of dominoes in the background as a group of men played at a table in the corner, smoking furiously and downing shots of thick Greek coffee. That evening, sitting on the walls of the old castle, we watched the sun slowly lower itself into the glittering waves, the crowd of onlookers falling silent as if expecting to hear a hiss, before breaking into a soft patter of applause at the magnificent sight. Far out in the channel a small boat headed into the purple dusk, the wake spreading ripples of light across the smooth surface of the sea. As people began to disperse and head down into the town I looked out at the glassy ribbon of water that continued to linger long after the boat had disappeared from view, knowing that the scene would become an unforgettable memory of Santorini.