Matera, located in Basilicata near the border of Puglia, is one of the most unusual towns in all of Italy in this respect... because of its Sassi (literally, rocks), the cave homes dug into the mountain that the city sits upon. People have been living in caves for 50,000 years here. The Sassi have been restored into posh hotels and B&Bs and apartments with Matera itself declared the Capitol of Europe for 2019.
In winter, the surrounding rocky landscape and the Sassi homes are a wonderland, especially with a dusting of snow...
In December and January, visitors to Matera can walk through the Sassi, along the edge of the gorge and enjoy the Living Presepio displays. Much like small presepio displays, besides the Nativity scene itself (with Joseph, Mary and Jesus), there are costumed Materese portraying shopkeepers, musicians, beggars and gypsies from the time of Jesus.