Milwaukee is just two hours from Chicago yet doesn't get much of a look-in from overseas visitors. But with retro drive-ins, micro-breweries and boutique art galleries, it's the perfect place for a hip city break

There's really only one way to arrive in Milwaukee – on the back of a chopper. Home of Harley-Davidson, this old industrial city on the banks of Lake Michigan is a mecca for petrol heads on a pilgrimage to the downtown bike museum. But the city's not just about the creak of leather and the growl of a two stroke. With boutique breweries, retro cocktail lounges, the world's largest music festival, and a cutting edge art gallery, unpretentious Milwaukee is one of the coolest cities in the midwest.

Under two hours from Chicago by train, Milwaukee is considered to be the Windy City's baby sister, a tag that locals take on the chin. "We don't mind being the little guy," bar owner Charles Jordan smiles as he shakes up a round of Mai-Tais. True, Milwaukee doesn't have Chicago's vertigo-inducing architecture, but there is unpolished charm to the skyline of industrial towers and vintage factory signs, while a lush lakefront trail gently ushers visitors from beach to beach or off into one of Milwaukee's quirky neighbourhoods.

In Foundation (foundationbar.com), Jordan's Tiki joint that miraculously makes hula seem hip, glowing puffer fish lamps dangle above the heads of a posse of scooter riders who've just arrived for a sundowner. Wicker monkeys eyeball us from the walls and a tropical fish tank gurgles in time to the beat of 60s soul. If this Tiki bar has a vintage vibe that's nothing in comparison to our next stop, Bryant's (bryantscocktaillounge.com), a velvet clad cocktail lounge that's as effortlessly smooth as the mixologist behind the bar.

"I'm your menu," the bartender announces when we request details of their house drinks. At Bryant's your server will whip up a bespoke tipple. With glittering gold tills, moodily lit leather booths and Sinatra crooning in the background, Bryant's could seem hideously kitsch, were it not for the fact that the slick decor in this 70-year old bar is nearly all original. In Milwaukee retro isn't set-dressing, it's the real deal.

Leon's drive-in. Photograph: Ellie Watts-Russell

On the south side of the city, Leon's Frozen Custard (leonsfrozencustard.us) is a neon and chrome drive in which has been serving the state's famous frozen snack since 1942. Supposedly the inspiration for Arnold's diner in Happy Days (the cult 70s comedy was set in Milwaukee) servers still wearing paper hats and white aprons take orders for malt shakes or cherry loaded sundaes.

A few blocks North on Lincoln Avenue, hidden beneath Gene and Marcy's Holler House (2042 West Lincoln Ave), you'll find the country's oldest bowling alley, two narrow dusty lanes where pin boys are employed to reset your game by hand. Marcy Skowronski, the elderly proprietor, shouts at a baseball game on the television and explains that the tavern's name came from punters having to holler over the blast of the jukebox. Bras left by previous visitors dangle from the ceiling, a tradition that not all first time drinkers may want to take part in. Skowronski shrugs as we leave and turns to watch her game again: "Give it a couple of drinks, it'll be hanging."

I hold onto my underwear and head to the Walker's Point district where visitors seeking a vintage memento to take home will find warehouses like Dime A Dance (1134 South 1st Street) or Clinton Street Antiques (clintonstreetantiques.com) jammed with quirky knickknacks, like tobacco tins and 50s clothes at half the price of their Chicago equivalents.

Old-fashioned charm it might have, but Milwaukee is by no means trapped in a time warp. The industrially chic Iron Horse Hotel (theironhorsehotel.com) is a former bedding factory transformed into a biker-friendly boutique stopover. From the lofty rooms of the dark cubed building you see across the river to the legendary Harley-Davidson museum (harley-davidson.com), which is well worth a visit even if you're not a hog.

However you have to head closer to the water to find the city's most electrifying building, the Milwaukee Arts Museum (mam.org), designed by Spanish architect Santiago Calatrava. With vast retractable wings the main pavilion gives the impression of a sea bird landing on Lake Michigan. At night the white feathers draw in as the gallery is put to bed. This mesmerising building alone is worth a trip to, but it also houses some of the country's most interesting collections of post-1960 artwork (Homer, Picasso, Miro, Warhol) as well as consistently dynamic temporary exhibitions.

The city is dotted with small galleries like the minimalist Green Gallery (thegreengallery.biz) or Jackpot (825 East Center St) in the edgy River West area. Across the road you'll find River West Film and Video (riverwestfilm.myshopify.com), a DVD shop which doesn't just rent out abstract films but pieces of contemporary art as well. Pick a piece from their menu and take home a canvas for just one night or on a monthly plan.

Sky High Skateboard shop. Photograph: Ellie Watts-Russell

Further south in the Bay View neighbourhood a pack of boarders slam tricks along the curb while they wait for Sky High (skyhighskateboardshop.com) to open, an innovative skater shop which has converted its stock room into a rotating exhibition space for emerging artists. Drew, an assistant wearing taped up spectacles, explains that Milwaukee has a strong entrepreneurial streak, a knack for turning old into new. "We realise what we have is good," he says, "then we work out how to make it more fun."

Nowhere is this statement more applicable than at Honeypie bakery and cafe (honeypiecafe.com), a modern midwestern inspired eatery where our bloody mary comes garnished with hand pickled veg and local salami. Behind the counter tattooed servers deliver plates of meatloaf or biscuits drizzled with gravy, all with a fresh spin. Like the Wisconsin grass-fed beef they use in their burgers, most of their ingredients are sourced locally, and the downy white, pillow like rows of cream pies behind the counter are all made on site.

Honeypie's sister venture, Comet Café (thecometcafe.com), has brunch hunters queuing around the block on weekends, as well as a staggering range of Milwaukee's home-grown brews. (They hold a monthly beer school to help novices slurp their way through the list). Watching the head settle on a local Sprecher stout that tastes as smooth as caramel chocolate, we're reminded that Milwaukee was a city built on beer. Home to some of America's most famous brewing empires (Miller, Pabst, Schlitz) it now has a thriving industry of boutique breweries. Hop-heads shouldn't miss the comic and boozy tour from Lakefront Brewery (lakefrontbrewery.com).

As we zigzag our way to our final destination, the Cactus Club (cactusclubmilwaukee.com), a pocket sized music venue, fireworks fizz overhead from a local block party. During the summer there's outdoor festivities most weekends in Milwaukee, from Rockerbox (a celebration of vintage bikes) to Brewfest (a gathering of craft brewers) as well as supposedly the world's largest music event, Summerfest. This epic 11-day, 11-stage affair hosts 700 bands with headliners who have included The Flaming Lips, Jeff Beck, Eric Clapton and NERD.

Inside the more intimate Cactus Club a 19-year-old drummer from Nashville thrashes hypnotically behind a soundproof door. We grab a nightcap and join the toe tapping musos in the back room. "This is a song about growing up in Wisconsin," the next band announces. As a female keyboardist in a vintage frock sways and hums into her mike it occurs to me that if Chicago and Milwaukee really are related, then she's the hip younger sister you secretly want to hang out with.

• Amtrak's (amtrak.com) Hiawatha service runs 14 trains daily between Chicago and Milwaukee. The 90-minute trip costs $23 each way. The Iron Horse Hotel (theironhorsehotel.com) has doubles from $219 per night