Japan’s ryokan tradition has remained largely unchanged for centuries. Small, family-run inns, ryokans steep travelers in old-fashioned Japanese culture with an emphasis on cuisine. They’re commonly found in Kyoto or in the countryside and frequently feature onsen (hot springs). Staying at one – especially for foreigners – is like stepping into the consummate picture of Japan’s past: Austere rooms are arrayed with tatami mats and shoji screens, guests sleep on futons and dress in yukata (cotton kimonos), and the staff strives for pitch-perfect service.

Over the past decade, however, some travelers – Japanese and foreigners alike – have expressed a desire for more-modern creature comforts. Enter the rise of what I call the “neo-ryo”: luxury resorts with modern  amenities that take their visual cues and ethos from the old-school inns.

Hoshinoya Resorts has been especially adept at blending old and new, starting in 2005 with its launch of Hoshinoya Karuizawa (from $400/night; hoshinoya.com), in the town of Karuizawa. The inn is located slightly more than an hour from Tokyo on the Nagano train line. After passing through a series of long tunnels, the train suddenly leaves the city’s urban sprawl behind. In the mountains, the town of Karuizawa lies at the foot of an active volcano, Mount Asama.

“It erupted just last year,” hotel staffer Kyoko Tanzawa cheerily said upon my arrival at the resort (the incident turned out to be merely a gaseous belch). Japan’s pervasive volcanic activity is, of course, the source for the many hot springs so beloved by its residents.

Hoshinoya Karuizawa is deeply tied to its natural surroundings – 10 acres of lush forest, home to flying squirrels, owls, and bears – and 75 percent of its energy comes from an on-site hydropower plant. Hoshinoya created the resort (the site of a popular ryokan for the past century) because “Japanese people don’t feel that traditional ryokans are relaxing anymore,” says Tanzawa. She suggests that the strictures of the old format simply seem too stuffy.

Certainly Karuizawa encourages a kind of Zen calm. Before checking in, guests sip tea while a staffer plays an elaborate musical instrument called a yagura.

The resort resembles a small village, with 77 villas arranged around a picturesque river that is liberally strewn with terraced, man-made waterfalls and rice paddies, a testament to the Japanese predilection for tightly managed nature.

Its main restaurant, in a steeply tiered building, specializes in kaiseki, the traditional Japanese meal of many small, delectable courses composed of seasonal produce. There are just a few tables on each level, and with picture windows all around, and dim, lantern-like fixtures, the sleek eatery exudes a dramatic glow at night. The resort also has a casual French restaurant.

Rooms feature a mix of classic Japanese elements, such as a sunken dining area and raised platform table, with a contemporary assortment of colorful pillows for sitting. The futon-style beds are higher and more plush than the typical floor-hugging model and the bathrooms are larger and more luxurious than those at most ryokans. In keeping with tradition, guests trade shoes for wooden slippers upon entering their rooms.

Yet the centerpiece for relaxation is still the onsen. Karuizawa has two: a main spa that’s open to day visitors and a separate meditation bath for hotel guests only. A communal bath is not to everyone’s taste, but I found it easy to unwind after sinking into the steaming pool – head back, eyes closed, bubbles all around. The water possesses an intensely mineral character; I’d swear I could smell volcano.

Last year Hoshinoya Resorts opened a similar retreat in Kyoto, Hoshinoya Kyoto (from $500/night; www.kyoto.hoshinoya.com). For an even more modern take on the neo-ryo, try Niki Club (from $385/night with breakfast and dinner; www.nikiclub.jp), less than 2 hours by train from Tokyo in the pretty town of Nasu (once the imperial family’s country getaway). The resort offers a Terence Conran–designed wing, a Western–style restaurant, and even tennis courts by the outdoor onsen.

From the Summer 2010 issue of Sherman's Travel magazine.

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