My boyfriend and I stayed the second week of August in a vacation rental with a deck looking out over the working harbor. Pier One Vacation Rentals has four modern units in a building originally built in the 1850’s as a boathouse. Southwest Harbor offers lodging from camping, to B&B’s, to inns, to small hotels. We chose the vacation rental because of its kitchen, but we cooked only once during the week. Our vacation became a Maine feast. 
The bigger and more famous Bar Harbor is known for its restaurants, but no need to leave the Southwest Harbor area for good dining. Our abandonment of the kitchen began our first night in town at the Captain’s Gallery of Beal’s Lobster Pier. We picked out our lobsters from the holding tank, and 15 minutes later on their deck overlooking the harbor we were eating fresh boiled lobster that one of the contract lobster fishermen had brought in and sold to Beal’s earlier in the day.
Another place for great lobster on the quiet side is Thurston’s Lobster Pound in Bass Harbor, a working fishing village. On another picnic table overlooking another harbor we had lobster rolls so full I had to eat it with a fork. And the photo opportunities on this working harbor made it hard to sit down to eat.
Red Sky for American fine cuisine and Bella Mare for elegant Italian are two places where you can dress fairly casually but be served in a formal manner. Don’t be fooled by the plain looking exterior of Red Sky – the food is anything but plain. And from our window seats at Bella Mare we could see the sun setting over the water while we ate seafood done up Italian and a classical guitarist played for us.