Café del Español, Calle de Príncipe
Another good recommendation from Time Out, this is a grand cafe with serious style. There is plenty of room inside, because everyone is outside on Plaza Santa Ana, and I found a perfect spot in the corner on a comfy bench that is perfect for reading and people-watching in the evening. And writing reviews, of course. The comfy furniture and lighting give this place a far nicer atmosphere than Café Comercial, which makes the similarly high prices better value.