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This has a wonderful view over the harbour and also of the castle. The food is reasonably priced. There is also a telescope to view the stars and moon. It is a delightful restaurant to visit during the day and again at night.
It can be found by looking up above the other harbour restaurants to see its neon sign. It can be reached via a back street which could be off putting. Walk past Hillside Restaurant and Ney Restaurant.
An authentic Turkish restaurant recommended in the Lonely Planet book. It has only 14 seats in the whole restaurant. Taste the wonderful Turkish mezes and food on offer. Please learn a few basic Turkish words before holidaying, even in Marmaris, as it is very much appreciated by the locals. It is difficult to pass all the other lovely restaurants to reach it and is expensive compared to other restaurants (but that was expected and not expensive compared to UK standards and prices), but it's worth it. The red and white wines are nice.
This is also recommended in the Lonely Planet due to its wonderful fish selection. Order a mixed meze plate which certainly is filling. This restaurant in on the harbour side.