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1) There are plenty of diving trips to choose from. Same with snorkeling trips. You can snorkel on a day-long tour for 500 baht. There are many to choose from. The travel agencies all over the island basically offer the same destinations. They are all legit but you might want to compare prices a little bit, though they shouldn't vary by much.
A typical motor boat tour starts at 9 am and includes a snorkle mask, fins, lunch and water, coffee, etc. You may stop at different beaches - including Maya Bay on Koh Phi Phi Ley.
There are only 2 sailboats to choose from on the island. Captain Bob's Sailing Booze Cruise and DragonHeart. Dragonheart is a 64 meter Pinisi Sailboat that offers day and sunset cruises. Great music and very relaxing, visit all the beaches in style and get a fantastic Thai meal prepared onboard. Captain Bob's Booze Cruise offers afternoon trips with every activity you can do on the water (cliff jump, monkey feed, fishing, snorkel, kayaking) as well as all you can drink beer.
2) Walk across the middle part of the island through the palms or through the village and it's shops. It's only about a 10 minute walk from the pier and the other side of the beach is longer with a great, laid back, bohemian feel. You can stay in budget bungalows here, rent beach chairs, tan topless and play frisbee. The pier side of the beach is much smaller because of all the boats docked there.
3) Rent a longtail boat and captain to take you around the island and allow you to visit some of the more remote beaches. Longtail boats can seem like a traditional choice but may not be the choice for someone who gets sea sick easily. A speed boat could be a better option.
4) Dine! Dine! Dine! This island abounds with great cuisine from delicious and cheap Thai pancakes (try banana and honey for 30 baht) to authentic Italian pastas and pizza to fresh seafood cooked to order. The food was all good though prices do vary. Many restaurants show a new release during meal time so you can combine dinner with a movie. Drinks on Koh Phi Phi seemed to all have purified ice. You can tell it's purified if the icecubes are large and oval, with a round hole in the center. Blended drinks are also made with good ice.
5) The nightlife is fun and geared towards young backpackers. The ice is good but be aware, drinks are rarely strong in Thailand so sometimes beer seems like a better bet for your money. Clubs like the Apache, the Tiger Bar, the Reggae Bar and Carlitos offer coupons to get patrons inside - definitely take a flyer and get your free drink or discount! Apparently these clubs really get going around midnight and people party late.
What about something different? why not visit the only place to learn some real authentic Thai dishes and the price is great too. Some of the details. They have a range of classes available from a simple quick 90min lesson where you learn three classic Thai dishes to a private 5hour one on one class and many in between, the choice is yours.
The classes are fun and very popular so book when you arrive.
You can find Pum Restaurant in the centre of town, from the main beach road turn town the shopping street in-between the two dive shops (Aquanaughts and Phi Phi Scuba) and you’ll find them ¾ of the way down, look out for the orange signs, you cant really miss them). If you're only on the island for a few days it's better to book Pum's cooking school in advance as they can fill up - you can email them via their website.