'A desert between two roaring seas ... an aspect of nature which will give you a picture of Africa's desert, of the ash heaps of Pompeii and of the sandbanks in the great ocean above which birds soar.'

None of which sounds much like Denmark, typically a land of flat green fields, grazing cows and sleepy half-timbered villages. But at the northern tip of Jutland is Skagen, with the unique character and extreme scenery that drove Hans Christian Andersen into rapture and caused him to pen the above after visiting the place in 1859.

As soon as you arrive in Skagen you squint: everything is yellow – the houses, the railway station, the church, the shops – and all of it bathed in a sunlight which seems to gain extra brightness by being reflected off two separate seas and a desert-like belt of sand dunes nearby. The distinctive colour of the town's buildings, stemming from the cheapest form of housepaint available, is a shade known throughout Denmark as 'Skagen Yellow'.

But it was a different kind of paint which brought the small community to prominence around the turn of the century, after Andersen's eulogy enticed a number of young artists. The first of these to arrive was Michael Ancher. He married a local woman, Anna, the step-sister of the owner of the town's only hotel, Brøndum's Inn (with appropriate fairy-tale-like synchronicity, Anna was born in the hotel on the same day Andersen arrived).

It was Michael and Anna, along with the Swede, Peder Krøyer, who were to be the painters whose names became most synonymous with Skagen, although the pioneering trio were followed by a procession of easel wielders as Skagen's reputation spread, and the previously obscure fishing village was turned into a veritable 'artists' colony'.

While they're often thought of as Romantic influenced painters today, at that time the Skagen artists were considered a rebellious bunch. Their plan was to break free of what they viewed as the continental domination of art and the fashion for extravagant depictions of grand historic occasions, and to replace the pomp and ceremony with something earthy and Nordic, which would highlight the rural qualities of honest toil and quiet dignity.

This they achieved, painting the local fisherfolk at work, rest and play, as well as producing general scenes of the bleakly beautiful surrounding landscapes – impregnating all their work with the subtle definition of tone made possible by the fine Skagen light.

Nordic art, particularly the Skagen stuff, is rapidly becoming a very collectable commodity in art dealing circles, as recent multi-million pound auctions at both Christie's and Sotheby's have proved.

But for a few kroner you can admire some of the best of the artists' work in the Skagen Museum (ironically, perhaps, along with Brøndum's and the home of Michael and Anna Ancher, one of the few non-yellow buildings to be found in the town), a collection made successful not only through the excellent paintings themselves (although a few individually outstanding examples, like most things Danish, are serving time in Copenhagen) but because the radiant qualities of the specially intense Skagen sunlight envelopes you as you step outside, just as it does the characters portrayed on the canvasses.

The relationship between the artists and the fishing families was generally friendly, though the social divisions were seldom crossed and the partnership was finally extinguished when the artists' success inadvertently made Skagen fashionable.

Legions of upper-class Danes, who had seen the paintings of the rough-hewn natives in art galleries, began arriving to gawp at their in their natural habitat – and to people the 40-odd miles of sandy beaches which the advent of railways had put within easy reach.

But the town has changed much less than might be expected since the artists' time. Its distance from main centres of communication have prevented any major industrial growth, leaving small-scale fishing still the primary activity and although tourism comes a close second, the usual trappings of the bucket and spade brigade are absent.

Just a palette's throw from the museum, Brøndum's Inn is still a good place to stay. Despite trying to drag itself into the 1980s – adding an annexe for those who can't contemplate sleeping without in-room TV and en suite khazi – the main building of the hotel remains interestingly atmospheric: excitable plumbing, noise enhancing plasterboard walls and communal WC/showers with full views to (and from) the car park.

Compensation for these things comes by way of the paintings on the walls, original works by the Anchers and others poised above as you nibble a morning pastry and contemplate the loud check trousers worn by visiting Swedes and Norwegians.

The surrounds of Skagen were as appealing to the artists as were the inhabitants of the town. The area to the south has vistas of eerie desolation: mysterious sand formations and obscure trails over and around heather-capped dunes. The wild state was brought about by vicious sandstorms kicked up by North Sea gales.

During the 1700s a whole community here had to be abandoned as it gradually sank beneath freshly blown-in sand – the only marker to it now is the succinctly named Buried Church: just a red roof and the white gabled tower protruding above the dunes.

Recent ecological know-how has led to the planting of trees and the cultivation of a thick swath of hardy vegetation, which have stemmed the potential for devastation and slowed the migration of one enormous dune called Råbjerg Mile. Fifty metres high in places, this still moves a few yards eastwards annually but relieved residents, once trembling in its path, now speak of it as they might a panther that's been tamed into a tabby, whilst directing intrepid sightseers towards it.

Much of the strange terrain can be seen as you approach Skagen. Without personal transport, the journey is only possible with either the sporadic bus service or the privately-run train – a dinky-sized two-carriage affair where you have to ring the bell to be let off anywhere other than the start and end points of the route – from Frederikshavn.

An equally downhome form of transportation is the little tractor-like conveyance which ferries visitors the couple of miles from the edge of Skagen to Grenen.

It's off Grenen (basically a long beach with a car park and snack bar) that two barely compatible seas collide. On the eastern side is the relatively calm Kattegat, a sort of book-end of the Baltic, and on the western side is the far more volatile Skagerrak, a flank of the North Sea.

The actual sight of their meeting is quite bizarre: the land tapers to become a sand-spit beyond which the two seas don't know what to make of each other – or which way to flow – leaving the weird spectacle of waves breaking against one another at all kinds of angles far into the distance. Closer to the beach, windsurfers skim and bounce over the crashing foam on one side and on the other, just a few yards, infants paddle in lagoon-calm waters.

A contemporary of the artists, writer Holger Drachmann, so liked the constant threshings of nature hereabouts that he had himself, after death, buried inside in a special tomb embedded within the northernmost dune. Which, like Hans Andersen's literary gushings, gives a suggestion of Skagen's possibilities – but might be taking things a bit far ...