LEAVENWORTH, Wash. (AP) -- The scent of bratwurst and pretzels filled the air as horses clopped down the main street, hauling a carriage full of tourists. Nestled in her mother's arms, a baby reached out to touch a shop window display, peering toward the sequin-covered reindeer behind it, as colorful ornaments twirled nearby.

Welcome to Leavenworth, Washington, the Christmas capital of the Pacific Northwest.

Decades ago, Leavenworth was a near ghost town on the eastern slopes of the Cascade Mountains, one of the region's poorest communities. The mines and the sawmill had closed, and even the railroad left. In the 1960s, desperate business owners made a serious gamble. Without any state or federal help, they began taking out loans and remodeling the downtown in the style of a Bavarian village.

More than half a century later, the result brings tourists from near and far all year long -- hikers and skiers, river rafters and fly-fishers, shoppers and day-trippers from Seattle, some 3 million visitors in all last year, according to Matt Cade, president of the Greater Leavenworth Museum. The crush has prompted concerns about the cost of living, and recent efforts, including some state funding for affordable apartments, have focused on ensuring that tourism industry workers can live in town.

But the town peaks in popularity during the holidays.

In December, it takes on the ruddy, warm glow of a German Christmas market, with the magic of choirs, carolers, food vendors and a gingerbread house contest. The longstanding practice of switching on the Christmas lights downtown on Saturday and Sunday evenings began to draw such large crowds that organizers eventually decided to just leave them on from Thanksgiving through February.

"Every time I go there, I just feel joy and excitement," said Alison Epsom, of Sultan, who visited with her husband, Brian Jolly, and their 8-month-old daughter, Acacia.

The couple met nearly two decades ago, when they were performing at an international dance festival. For one of their first dates, Jolly invited Epsom, a native of England, to visit Leavenworth.

"I knew I had one opportunity that she was going to be here and I wanted her to fall in love with me," he recalled.

As they drove through the mountain pass on their way, she told him to pull over. She jumped outside without a coat and made a little snowman.

"I had never seen that much snow," Epsom said. "So that was absolutely magical to me."

They have made it an annual tradition to return to Leavenworth, and every year they pick out a new ornament for their tree at the Kris Kringl shop downtown. The town is a core part of the couple's love story. Jolly even proposed to her on a horse-drawn sleigh.

This year, it was their daughter's turn to pick out the new ornament -- her parents decided they'd buy the first one she touched. She grabbed at a white owl, which now hangs from the family's Christmas tree, near the red- and gold-glittered star that Epsom picked out on their first visit.