Train to Machu Picchu and Aguas Calientes.
I immediately fell in love with Aguas Calientes. The town is comprised of two main (and very steep!) streets lined with hostels, hotels, restaurants, and shops. Since I arrived midday, I opted to explore the town on foot. My favorite place was the town square. It is a great place to read a book or do some people watching.
Aguas calientes was also the first place where I tried lomo saltado, a Peruvian specialty!