Once the fabled capital of a dozen dynasties, from the golden Tang (618–907) back to the original Qin (221–207 B.C.), Xi’an has been a sleeping giant, nearly forgotten for five centuries. Beijing is modern China’s capital, and today the east coast is lined with boom towns from Shanghai to Shenzhen. But the economic roar is also rattling the city walls of the old capital, Xi’an, deep in the western interior. These days, Xi’an is serving two new masters: a growing middle class and a mass of foreign tourists. For every brick pagoda, Buddhist temple and silk scroll within its precincts, Xi’an also boasts an international hotel, a Buick dealership and an Italian-designer boutique.

This sudden modernization of the middle of the Middle Kingdom can be bewildering. Twenty-five years ago, when I worked in this city as a teacher, there wasn’t a taxi to be hailed within a thousand miles; few foreign goods ever filtered in through the city gates; and rice, even bicycles, required ration coupons. These days, Xi’an rations nothing. This end of the Silk Road is hoisting its solar panels and polishing its antiques. Marco Polo wouldn’t recognize the place.

I barely recognized it myself. When last in Paris, I stayed at a Citadines apartment-hotel, which afforded me a fine view of the Eiffel Tower, romantically lit at night. Arriving in Xi’an, I was able to stay at the same hotel chain, which afforded me a splendid view of the 14th-centrury Drum Tower, lit with kites streaming from the tiled rooftops. Xi’an is hardly Paris; it’s light years behind in sophistication and delights. But the ancient capital is quickly catching up.

At the same time, Xi’an has not abandoned its past. Outside the city walls, the First Emperor’s Terra-cotta Army, comparable in grandeur (and gross revenues) to the Great Wall, has propelled Xi’an to the peak of world tourism. The vaults of Emperor Qin Shi Huang’s life-size, 7,000-strong subterranean guard, buried since 210 B.C., were unearthed in 1974 by a local farmer (although not the one posing as such in the gift shop). Despite commercial development outside the vaults, the focus inside this crucial archaeological site is on the disentombed statuary. And there I discovered a welcome change, too: Snapshots of the warriors are now permitted, meaning the staff is no longer obliged to rip cameras out of visitors’ hands.

A second ancient marvel, the Big Wild Goose Pagoda (Da Yanta, built in 652), has fared less well against the sprawl of mass tourism. The temple grounds, several miles south of the city wall, have been grossly augmented, to the south by an Emperor Qin-themed amusement park and to the north by a series of fountain terraces that spout to music in the evenings. Nevertheless, it’s still well worth scaling the winding stairs of this fabled Buddhist pagoda, where the Silk Road reached its zenith and Chinese Buddhism flowered.

Inside the city walls where I was happily ensconced for a week, many of the old wonders have been bulldozed aside, but the survivors are on the rise. The quaint, unpolished Forest of Steles Museum, tucked inside the southern city wall on the grounds of the 14th-century Temple of Confucius, proved as sprightly as ever. The back hall (No. 4) is where the action is. Hand rubbings of the most interesting of China’s steles (engraved stone tablets) were inked and pounded out as I looked on — then sold on the spot.

Meanwhile, in the heart of the city, sharply dressed, aspiring young office workers in a hurry collided with sightseeing peasants taking in the new China they’ve all heard about. For people-watching, the best vantage point is outside the entrance to the grandiose Kaiyuan Department Store opposite the Bell Tower, Xi’an’s symbol since 1384. The Bell Tower is no longer ringed by the bicycles and donkey carts I remember from the 1980s and ’90s but by private cars, taxis, motorcycles and more than one Mercedes. The main downtown boulevards that intersect at the Drum Tower, however, are still clogged with old-fashioned entrepreneurs — fortune tellers, letter writers, sidewalk seamstresses, toy salesmen and suntanned peasant map-sellers barking at the top of their lungs.

The Bell Tower is connected to the equally ancient Drum Tower by a new public square lined with Ming- and Qing-style shops. Here the prevailing eatery, perched atop a Häagen-Dazs shop, spells out its moniker and motto in a scroll of neon calligraphy a quarter-mile long, with this English subtitle: “The Legendary De Fa Chang Restaurant is renowned for its superior delicious dumplings.” Come nightfall, pop music is piped in, young locals sweep through the square and the Drum Tower is illuminated by kites soaring upward in long, golden streaks.

North of the Drum Tower is the Muslim Quarter, where the Hui minority have made Xi’an their home for 13 centuries. Down a side lane, the Great Mosque, built in 742 and China’s oldest, is still a sweet refuge from the masses, even if the courtyards, pavilions, minaret and prayer hall have been repaired too often to qualify as originals. Here I spent several lazy afternoons wandering Beiyuanmen Islamic Street, a full-blown outdoor bazaar hawking crafts, steamed dumplings and skewers of barbecued lamb.

The essential landmark of the walled city is the wall itself, a Ming Dynasty (1368–1644) creation. It has no peer in China. I’ve seen it ripped apart and reassembled over the past three decades, its moat re-gouged, its ramparts repaved. You can now walk all four sides, nine miles around, but I preferred to make a circuit on a rented bicycle. As I bumped along over the flagstones and prayed that the tires wouldn’t pop, I surveyed Xi’an at a pre-industrialized pace.

Even from the heights of the city wall, the Big Wild Goose Pagoda of Xi’an has been made invisible these days, screened off by ranks of rising office towers and apartment blocks. There’s plenty of concrete and glass sprouting inside the city walls, too. But on the green belt etched between the moat and the city wall, I could see a vibrant human dimension as well: teenagers playing table tennis, opera singers holding forth in pavilions, kite-flyers yanking on strings, lovers snuggling on benches, grandparents hoisting grandchildren onto monkey bars, peasants retiling the roofs of ancient temples. After centuries of drowsy decline, Xi’an is shaking off the dust of its ancient dynasties and simmering with new life, inside and out.