THE word about Penola's quality of life is spreading, writes KATE DOWLER

In the 1980s, Penola was a struggling small town in the South East of South Australia.

It had a rich history, with a prosperous farming and booming wine industry - in neighbouring Coonawarra - and a strong community spirit.

But its main street looked a bit sad and tourism was not strong.

Today, if you take a stroll down the main drag, Church St, things have changed.

Penola oozes its own village-style charm and has managed to balance its farming authenticity while appealing to tourists.

In fact, the town hit global headlines recently with the forthcoming canonisation of Australia's first saint, long-time Penola resident Mary MacKillop.

Together with Father Julian Tenison Woods, MacKillop founded the religious order, The Sisters of St Joseph, in Penola in 1866.

In 1867, the Woods MacKillop Schoolhouse was established for the children of the district, where she taught. These days there is a Mary MacKillop interpretive centre just off the main street.

But back on Church St, a must-see for sweet tooths is Toffee and Treats of Penola.

As lolly expert and local girl Emma Schulz says the shop is a treat for adults who remember how they used to buy lollies, with old English lollies among the favourites.

"People who come in are really, well, like kids in a lolly shop again," Emma says.

Being steeped in history, Penola has many families with links harking back a century or more.

Nikki Blackwell, who runs Balnaves, a large clothing store in the main street, is the seventh generation of her family to run the store.

"We were never forced into it, it is only if we wanted to do it," Nikki says.

"I worked in the retail industry, and it just made sense to come back here and run it.

"It is a true, department store and has been going for just over 150 years - we stock everything from ladies', men's and children's wear, to haberdashery.

"This area just has a wonderful community spirit that is so wonderful, and hard to find."

Just up the street from Balnaves are some newer kids on the block - Peter and Catherine Robinson, who moved out from Melbourne two years ago and started their own cafe, Divine.

And even though they don't have a long history in the region, Peter says they have been welcomed by the Penola and Coonawarra communities with open arms.

"We were just looking for somewhere that had a great atmosphere and being near a wine area, that has good tourist trade," he says.

"Without Penola there would be no Coonawarra, and with Coonawarra, no Penola; we need both."

Often spotted in their cafe is local identity Kate Spencer, who runs the National Trust community herb garden on historic Petticoat Lane, which features some of the town's original buildings and lays a few streets back from the main street, behind the Mary MacKillop interpretive centre.

Kate toils in the herb garden and supplies fresh, organically grown produce to local eateries.

On the opposite side of the road to Divine is Koonara, a cellar door with a difference.

The shop caters for both the wine sampling public, looking to try the local Koonara labels drop, and for those searching for homewares.

Deb Redman, whose husband Mal Redman is involved with the family's Redman Wines at Coonawarra, is also attracting new interest in the town.

Her fashion, homewares and lifestyle shop, Want, stocks an ever-changing range.

But any trip to Penola wouldn't be complete without stopping at some of the art galleries.

One of the best is Lois Hodge's Local Images, which has been running for 25 years, specialising in - you guessed it - works by local artists.

"The good thing about Penola is that it is a little village and a walking town for tourists, and it has that community spirit and friendliness that people like", she says.