Madrid is an odd mix of old and new, and when one stumbles across a small bar or restaurant with some heritage and charm, the desire to soak it all in is strong. That was my experience at Casa Camacho, a small vermouth bar owned by three brothers in the heart of the city’s trendy Malasaña neighborhood.

It is a shallow space the shape of a railroad car, with a long bar and vermouth barrels lining the wall behind. When we stopped in before dinner, it was noisy and crowded. Two ruddy-faced proprietors were working the antique vermouth spigots like musicians. The narrow shelves around the perimeter were stacked with empty plates spotted with olive pits, crumpled napkins and empty yayo glasses. We were pressed against our neighbors like croquetas de jamón.

You can order straight vermouth or have it con sifón (with a splash of sparkling water). Or you can order the specialty of the house, the yayo, a mix of sweet vermouth, gin and a Spanish lemon-lime soda that is on the dry side. The yayo is cheap—a couple of euros—and it goes down easily, but the combination of gin and vermouth will put a dent in your powers of observation. It comes with a small plate of green olives, but you can also order cheese, boquerones (marinated white anchovies) or berenjenas de Almagro (pickled baby eggplant).

Since we do not have the same Spanish lemon-lime soda here, a bit of fresh lemon juice and sparkling water offers a good substitute. At Milk Street, we like Lustau sweet vermouth over more bitter brands, because sweetness is a key ingredient of this drink. It nicely balances the bite of the gin and replaces some of the sweetness offered by the Spanish soda. And the hint of sweetness is beguiling, cloaking the serious oomph of this cocktail. Like Casa Camacho itself, the yayo first offers a friendly “hola,” and then you realize that this is serious business.