As far as the eye can see, trees festooned with twinkling lights line sidewalks jammed with jostling crowds speaking a mix of languages. Tourists from Indiana and India, Milwaukee and Madrid, stop to take pictures as they stroll along the great commercial thoroughfare, a sweeping promenade that boasts some of the most prestigious names in retailing.

Amid the crush of cars, buses and pedestrians, clip-clopping horse carriages take sightseers for a spin, lending a note of nostalgia to one of the world’s most famous shopping streets.

Nicknamed the Magnificent Mile, this stretch of Chicago’s North Michigan Avenue, extending from Oak Street to the Chicago River, is a year-round hotspot for locals and out-of-towners looking to open up their wallets and tap into the energy of America’s third largest city. But the Mag Mile kicks it up a notch during the holidays, a six-week period when the magic reaches a crescendo.
It’s here along Michigan Avenue where Chicago on Nov. 20 will officially usher in the Christmas season with the Magnificent Mile Lights Festival presented by Harris, an annual event staged the weekend before Thanksgiving. As always, the highlight is a procession led by Mickey Mouse, who as grand marshal will illuminate more than a million lights on 200 trees along the route that starts at Oak Street.

The parade, beginning at 5:30 p.m., will feature floats, marching bands, Disney characters and actors from Harry Potter. Festivities end at 6:55 with fireworks at the river. During the day, stage entertainment, food and family-friendly Lights Festival Lane activities keep merry-makers busy from 11 a.m. to 5 p.m. at Pioneer Court, a riverside plaza.

Shoppers exploring the Magnificent Mile will find familiar chains (Best Buy, Disney, Border’s, The Gap, Eddie Bauer, Marshalls) and one-of-a-kind specialty stores, plus luxury purveyors found in New York, Beverly Hills, Palm Beach and Paris. Even if you can’t spring for a bag at Louis Vuitton, a bauble at Tiffany or fashions from Saks Fifth Avenue, it’s fun to fantasize.

Along with window shopping, people-watching is another favorite pastime. Besides tourists from Pakistan, Russia and Des Moines, you’ll brush up against wealthy folks who live in the luxury condos on and off the Mile. More than a few heads turn at the sight of some of the well-coiffed pedestrians. You’d swear they were right out of a fashion magazine.

Water Tower Place, a vertical mall, is the hub of Michigan Avenue, offering more than 100 shops on eight levels. Stores range from Victoria’s Secret and Banana Republic to Coach and Abercrombie & Fitch. Sports fans stop by the Cubs Clubhouse, a vision in “Cubbie blue,” while Accent Chicago offers Chicago-themed gifts, including sports logo wear, framed skyline photos and even a deep-dish pizza T-shirt that comes in a pizza box. Also check out The Oprah Store kiosk.

Anchoring Water Tower Place are Macy’s department store and American Girl Place. A focal point for many out-of-town families, American Girl, one of only nine such retail outlets in the country, is a supercenter for devotees of the iconic dolls, complete with a doll hair salon, photo studio and cafe.

For a quick meal at Water Tower Place, stop by Wow Bao at the mall entrance and try the steamed Asian buns (bao) filled with spicy Mongolian beef, Thai curry chicken, teriyaki chicken or coconut custard.

Water Tower Place lies right across the avenue from the historic Chicago Water Tower, an 1869 limestone landmark dwarfed by high-rises. Carriage rides ($40 a half hour) depart from the little park at the foot of the “castle,” a survivor of the 1871 Great Chicago Fire.

At Hershey’s Chicago, facing the horse buggies at Water Tower Park, drop in for cocoa, ice cream or a fancy cupcake. Gift ideas include Reese’s and Twizzler pillows, giant Hershey Kisses and oversize chocolate syrup containers. Customers can personalize a Hershey bar with their photo on the wrapper.

You’ll no doubt see a line spilling out the door at Garrett Popcorn Shop, a Chicago favorite for more than 60 years. With the sweet aroma wafting into the frigid air, people wait patiently to buy a snack-size bag of the gourmet popcorn or a gift tin ($26-$189). Garrett’s Chicago Mix is a combination of its CaramelCrisp (which customers can choose to be blended with cashews, almonds, macadamias or pecans) and CheeseCorn.

Not far from Garrett are two other Michigan Avenue magnets—Niketown, which has every style of Nike apparel imaginable—and the nation’s only Garmin retail outlet, where you can try out all the GPS systems. Gadget freaks also frequent the Apple store.

The 900 Shops, a six-level mall at 900 North Michigan, has an upscale ambience with Bloomingdale’s department store as its anchor. Other luxury retailers include Gucci and Montblanc.

In the Loop, downtown’s traditional retail and office hub, the big shopping news is the recent opening of an “experiential” Disney store in the new Block 37 mall across from Macy’s flagship on State Street. One of several such concept stores to open this year in North America, it has interactive stations and a mini-theater where kids can watch clips of Disney films, do art projects and enjoy storytelling with (virtual) Cinderella.

A block west is Christkindlmarket, a German-style Christmas market that sprouts up annually for a month-long stint on Daley Plaza. The Old World shopping village is filled with huts manned by European vendors selling nutcrackers, hand-blown glass ornaments, cuckoo clocks, beer steins and wooden toys. Make a meal of sausages, sauerkraut and potato pancakes, and wash it down with German beer or Gluhwein, a hot spiced wine.

Christkindlmarket opens on Thanksgiving Day following the McDonald’s Thanksgiving Parade on State Street. This year the parade kicks off with a performance by Ringling Bros. and Barnum & Bailey. Giant airborne balloons, equestrian units, marching bands and the Tap Dancing Christmas Trees are some of the highlights.

Christmas theater fare in the Loop includes A Christmas Carol, the Goodman Theatre’s beloved adaptation of Charles Dickens’ tale about old miser Ebeneezer Scrooge. Another tradition: The Nutcracker, a lavish dance and symphonic extravaganza staged by the Joffrey Ballet and Chicago Sinfonietta at the Auditorium Theatre.

A new holiday musical, Irving Berlin’s White Christmas, plays the Bank of America Theatre from Dec. 15-Jan.2. Direct from Broadway, it’s the story of two showbiz buddies putting on a show in a Vermont inn and finding their perfect mates in the bargain. Berlin hits include “Blue Skies,” “How Deep is the Ocean?” and the classic title song.

The Broadway musical Wicked, which set a Chicago record by running three and a half years until closing in 2009, makes a return engagement Dec. 1-Jan. 23 at the Cadillac Palace Theatre.