Arima Onsen

Arima Onsen is one of Japan's Three Old Hot Springs, with a recorded history going back to the Nihon Shoki, published in 631. The waters of Arima come in two flavors: the Gold Spring (金泉 Kinsen) is yellow-brown thanks to iron and salt, while the Silver Spring (銀泉 Ginsen) is colorless but mildly radioactive.
Administratively, Arima Onsen is a part of Kobe, but it's on the other side of Mount Rokko and thus a separate city for all practical purposes.

There are two ways to get to Arima Onsen from Kobe or Osaka: the cheap and practical way, or the fun but expensive way.
The practical way is to take the Hanshin, Hankyu or Sanyo Line to Shinkaichi (新開地) just west of Kobe, then transfer to the Kobe Railway Arima Line to terminus . Alternatively, if you're coming in on JR, get off at Kobe's Sannomiya Station or JR's Shin-Kobe Station, take the Kobe Subway or Hokushin Kyūkō Railway to Tanigami (谷上), and connect there to the Kobe Arima Line. In either case, make sure to transfer at Arimaguchi Station to the (one stop only) Arima Onsen Line. The whole trip will cost around ¥900-1000 and take about 45-60 minutes.
The fun way is to take the Hankyu line to Rokko station and continue up Mt. Rokko on the cablecar (10 min, ¥590/1000 one-way/return). Connect with the bus loop line (10 min, ¥260) to the Rokko Arima Ropeway, then take the ropeway down to Arima Onsen (12 min, ¥1010/1820 one-way/return). The Rokko Arima Katamichi Jōshaken (六甲有馬片道乗車券) combination ticket (¥1750 one way) works out marginally cheaper, and also lets you ride around the top of Mt. Rokko; foreign visitors can get it for ¥1000 (passport and proof of short stay required), but not on site, only in a limited number of places (Hanshin service centers in Sannomiya Station, Kansai Airport, Osaka, and Kyoto). This route is more scenic, but best avoided with heavy luggage.

It's quite easy to get around town on foot, though the uneven terrain may prove tiring to some. The JR train station has a large map of the area, but it is neither to scale nor oriented to the north.

Arima Onsen is famous for geisha performances, held at the many yearly festivals. In the local dialect, geisha are known as geigi (芸妓).

Arima Onsen is one of Japan's famous hot spring towns, so you should pay a visit to one of the many baths. There are three public baths (admission is ¥500-700) and a number of private ones. There are two hot springs from which all baths in Arima onsen get their water. One is full of iron giving it a brownish color and can be enjoyed in Kin No Yu, the other one is clear and slightly radioactive (don't worry) and can be enjoyed in Gin No Yu.
Take the ropeway up Mt Rokko and enjoy a view over Kobe and Osaka.

Tajima beef

• Hotel Kinzan

  address: 1302-4 Arima-cho, Kita-ku, Kobe
  It was opened as a high-quality ryotei (Japanese-style restaurant), these traditions carry though to the present day. Good selection of dishes, all prepared with the freshest seasonal ingredients.
• Guesthouse ENN, Check-in: 15:00, Check-out 10:00, private room or dormitory. Middle of the village, 5 minute walk from either Gin No Yu/Kin No Yu public baths. Very friendly couple running it speak basic English. Offer shared Japanese style dinner (2000yen) filling and delicious. From 4000yen for a bunk.