Tucked along the coastline of the second smallest country in South America, the tiny fishing village of Jose Ignacio is almost unknown around the world. But every summer, this sleepy backwater hosts the creme de la creme of the fashion world, celebrities and more than a few millionaire playboys. Staying in shabby chic cottages or sleek hotels overlooking the sea, they converge of the beach - a mass of honeyed limbs and perfect figures stretched out in the sun while planning where to party that night. The tiny village of Jose Ignacio is an understated getaway for the rich and famous, filed with pretty villas and sleek beach huts . Rolling Stone Ronnie Wood (left) and Colombian singer Shakira (right) are among the stars said to have escaped the spotlight by holidaying in the chic resort of Jose Ignacio . So, what has brought everyone from Colombian singer Shakira to Rolling Stone Ronnie Wood and restaurateur and playboy Giuseppe Cipriani - the man behind the glamorous Cipriani restaurants dotted around the world's most stylish cities - to these shores? Wedged between oversized neighbours Argentina and Brazil, Uruguay has largely stayed off the radar for European and American travellers, but has long been a favourite summer spot for South Americans thanks to its endless golden beaches and low prices. With an area of just 68,000 square miles, the country's sizeable Atlantic coastline is home to pretty villages, two major cities - the capital Montevideo and the glorious colonial Portuguese town of Colonia - while the interior is dotted with little more than estancia farms breeding cattle and growing wine. Each summer (during the American and European winter), Uruguay's beaches are taken over by well-heeled Brazilians and Argentinians looking for good food and sunshine. Even the luxury boutiques selling trinkets alongside designer products are designed in the shabby chic beach style . La Huella is one of the most famous restaurants in Jose Ignacio and a favourite with holidaymakers for its relaxed beach atmosphere . As telenovela (soap opera) actresses and Latin film stars descended on the coast, one resort in particular became the haunt of the rich and famous. Punta del Este, about 85 miles east of Montevideo, was soon known as the Miami of South America, with sumptuous hotels, pop-up restaurants run by celebrity chefs and visitors ranging from supermodels and actors to company CEOs. There are so many celebrity homes in the area that there has actually been a bus tour launched, much like the ones in LA and New York. And Punta del Este even has its own area called Beverly Hills. Naomi Campbell has visited, as have British and Spanish royalty, footballer Diego Maradona has a house nearby and even former US president George Bush has stayed. Locals and visitors stay understated in their beachwear (left) and the entrance of the village itself is posted with colourful signs by the side of the sandy roads . The dark-tiled pool perfectly reflects the sky and blends in with the sea beyond at the exclusive Playa Vik hotel . While the golden beaches of Uruguay are the main draw for Argentinian and Brazilian visitors, but those coming from further afield may want to combine Jose Ignacio and Punta del Este with some other hotspots. Colonia del Sacramento is perhaps Uruguay's prettiest town, with cobbled streets and crumbling buildings left over from Portuguese and Spanish rule . Colonia del Sacramento sits across the Rio de la Plata from Argentina (Buenos Aires is just an hour away by ferry). Owing its heritage to a mix of Portuguese and Spanish colonialism - the two battled over its strategic location - it is a maze of pretty cobbled streets, bougainvillea-draped buildings and a crumbling lighthouse with panoramic views. The picture-perfect spot is doesn't take long to explore but is ideal for a couple of lazy days strolling the streets, eating in patio restaurants and enjoying the atmosphere. The capital Montevideo tends to divide opinion among travellers. Some blast the city for its high-rise buildings and lack of colonial charm (at least when compared to nearby Colonia). But the quirky capital does have some of the buzz of its rival across the water Buenos Aires, with a beautiful 19th century market near the port crammed with restaurants serving asado (barbecue beef) and endless bottles of wine. The city has a necklace of beaches which come alive in the summer time with events and eateries and there is a faded beauty in the crumbling towers and Art Deco buildings of the city. Tango bars and theatres have combined to give the city a reputation as a true cultural hub in Uruguay. If you want to head away from the cities, then travel inland to the various estancias (ranches) that dominate the country's interior. There is a good business in rural tourism here, with estancias offering stays to visitors - ranging from the basic to the super-luxurious - and the chance to ride gaucho-style on horses through the countryside, learn about their culture and tuck into the freshest asado beef there is. Website www.welcomeuruguay.com has some options listed. With so many big names rubbing shoulders in one town, it is on wonder the ultra-chic crowd started to head elsewhere for some peace and quiet - which is how they happened upon tiny Jose Ignacio, just 22 miles east along the coast. Happen upon it on a quiet day and you would never know how popular it is. The tarmac road gives way to sand at the entrance of the village, pretty clapboard houses probably look more elegant than most, and signs pointing to chic boutiques and eateries are subtle. In the centre of the village is a simple square decorated with colourful flowers. There are no high rises, no gaudy luxury hotels, just an assortment of those shabby chic-style buildings that make the perfect romantic backdrop for fashion shoots - something which is not lost on the fashion directors of the world's glossiest magazines, who flock to the area to create stylish beach spreads. The hotels in the area hide behind walls and fences, leaving them almost invisible to the average visitor, while at the same time showcasing spectacular ocean views to their guests, taking advantage of the village's location on a peninsula jutting out to sea. The suites sit in individual huts covered in grass and wildflowers and the bedrooms boast spectacular views out to sea from the floor-to-ceiling windows . The central titanium and glass structure was designed as a sculpture and the back opens up onto the terrace and infinity pool . From the restaurant, guests can stroll out on to the terrace and sit by the pool which blends in with the sea beyond . One such sleek addition is Playa Vik, built by Norwegian-born hotelier Alex Vik, it is a sleek modern design which shouldn't work with the traditional ambience of the village but somehow does. Virgin Holidays Worldwide Journeys offers a 17-day Best of South America trip from £3,829pp. The trip includes return flights from London Heathrow to Lima and returning from Rio de Janeiro, accommodation and sightseeing encompassing Lima, Yucay, Machu Picchu, Cusco, Puno, Iguassu Falls, Buenos Aires and Rio de Janeiro. Price is based on two adults sharing a standard room on a mixed board basis and includes sightseeing with experienced English-speaking guides and transfers. An additional trip to Uruguay can be added into the itinerary at an extra cost. Stone and glass huts sit under grass roofs dotted with wildflowers, blending them in with their surroundings and are organised in a circle around a central grassy area. Inside, huge stone baths and showers give the bathroom a rustic feel, while the huge bedrooms have quirky quotes scrawled across them (a favourite is: 'May the fleas of a thousand camels infest the crotch of the person who screws up your day and may their arms be too short to scratch'). The floor-to-ceiling windows provide spectacular ocean views to those lucky enough to enjoy the end properties, and there are more chances to contemplate the seascape from the rooms on the top floor of the main building - a huge rectangular titanium and glass structure designed as an enormous sculpture. Paintings hang on every wall, a cosy library gives way to a grand open room used as a casual restaurant throughout the day and evening, but the showstopper is the missing fourth wall, leading out to decking and a narrow infinity swimming pool, complete with dark tiling, which juts straight out towards the sea and is illuminated with star-like lights at night. By day, guests languidly swim while looking out to sea and across the golden sands and in the evening, the terrace is the perfect place to watch the sun go down while enjoying a glass of Uruguayan wine. It may not be as famous as its Argentine neighbour, but the beef and wine in Uruguay is just as fabulous (just don't say that to an Argentinian). During my stay, bankers, fashion designers and movie executives mingle over fresh breakfasts, discuss their plans to explore further afield and generally create a convivial atmosphere so very different from the hugs nameless, faceless hotels often found at beach resorts. Chic beach houses are the order of the day in Jose Ignacio, with understated clapboard getting a modern twist and beach attire very much on the casual side . Uruguayan painter Carlos Paez Vilaro created this fairy tale home Casapueblo in Punta del Este perched on a clifftop and looking out to sea - visitors can tor the quirky property today and learn more about the artist or stay in the part of it converted into a hotel . Playa Vik has been such a success that down the road Estancia Vik has recently opened, providing a grander, more traditional atmosphere with its luxurious 'farmhouse', but it has a similar atmosphere to its siter hotel, created by spectacular works of art on every wall, fantastic food and a personalised service (I never meet a member of staff who doesn't greet me by name). For those looking for more than relaxation on the beach, the estancia offers the chance to ride horses through the countryside like a gaucho and take to the local rivers in a kayak. The best eateries frequented by the great and good are the stylish but casual dining options on the beach. Mostrador Santa Teresita was set up by Argentinian chef Fernando Trocca, serving fresh seafood and glorious salads. Parador La Huella is one of the most popular restaurants in town and opens with the same staff every year, serving only local produce and spectacular asados (barbecues), while La Susana also boasts a beautiful beach spot and has long been famed for its glorious barbecued meat paired with wines.
Jose Ignacio is a tiny fishing village on the Atlantic coast of Uruguay - the smallest country in South America.
Stars including Shakira and Ronnie Wood have been spotted at resort alongside restaurateur Giuseppe Cipriani.
Sandy lanes, understated boutiques and casual beach bars make up the small fishing village.
The key summer dates from travel are between Christmas and Easter.