Plaza de la Villa, which today exudes a quiet dignity, was the most important square in Madrid until Plaza Mayor was built. The buildings framing it on three sides were built between the 15th and 17th centuries. In medieval times, the city council used to meet in the San Salvador church, which was situated at the top of the square until it was demolished in the 19th century.

The oldest building now is the Torre y Casa de los Lujanes, on the left as you look down from Calle Mayor; it dates from the end of the 15th century. The statue in the middle of the square is of Admiral Ivaro de Bazan, who triumphed at the Battle of Lepanto, fought between Christians and Ottomans off the coast of Greece in 1571.

Taking up the other side of the square is the Casa de la Villa, or City Hall, one of the signature buildings of Madrid. Inside Casa de la Villa you will find 18th century tapestries from the Royal Tapestry Factory and a late 16th century silver monstrance that is carried through the neighbouring streets for the Corpus Christi processions.