In order to find this quirky little eaterie, you need to look out for the Ramblers' Tea Rooms as you make your way along East Chevin Road, as there are no signs either on the building or the roadside announcing its presence. In fact, we drove straight past it and had to make a phone call for further directions – but it was a warm and welcoming start to the evening to be waved into the car park by the chef as he guided us to our destination over the phone. During the day, walkers drop in to the tea rooms for a refreshing cuppa: but on certain evenings of the week (Tuesday, Wednesday, Thursday, Friday and Saturday) a transformation takes place and those in the know can enjoy Mexican-style vegetarian cookery served with refreshing unfussiness.

The downstairs area of what was presumably an old barn in Yorkgate Farm is where all the cooking and sizzling takes place, and there is a small area where you can wait with a drink if your table isn't yet ready. Upstairs is a large room partly divided by a low beam – but each section can be accessed by its own staircase. The restaurant can seat about 30 people, so the ambience is intimate, relaxed and friendly. Furniture is basic but solid and practical. There is almost no ornamentation in the room apart from a jaunty portrait of a chilli and some fairy lights laced around beams and staircase spindles: but a festive atmosphere nevertheless prevails.

Though you can certainly eat as a couple, there is a good argument for dining as a group of six or more. If you do, you can opt for the set menu which, at £15 per head, is a real bargain. It provides you with three courses and the opportunity to sample every dish on the menu. The evening we were there, the atmosphere was further enlivened by two large groups enjoying each other's company alongside a huge array of different delicious looking dishes.

Since the restaurant is unlicensed and diners bring their own alcoholic drinks, the cost of the evening is likely to be far less than usual when eating out in the Leeds area. A small corkage charge is levied – but corkscrews are thoughtfully provided on each table and the helpful waitress offered to keep the white wine we had brought with us chilled in the fridge. Non-alcoholic drinks are available and include a selection of fruit juices, coffee and tea and a jug of complimentary iced water is brought to your table on request.

We began with falafel accompanied by salad, tortilla and a chilli dip – a fairly substantial meal in itself for those with a smaller appetite – and a red onion and goat's cheese tart with a rocket salad. Both starters we tried were well presented, wholesome and very tasty. According to the café's website, all the dishes are freshly prepared using homegrown, locally produced and fairtrade products wherever possible; it also states that their aim is to provide "good quality vegetarian meals... and a value for money ethos". It succeeds on both counts.

Portions here are not only cheerful, they are extremely generous. Opt for something lighter, such as the soup of the day, if you feel you might struggle with three ample courses. Other starters include potato skins topped with melted cheese and served with sour cream, chargrilled vegetable salad and nachos with sour cream or guacamole. Prices range from £4 for soup of the day with bread to £4.75. There is also a mezze platter with haloumi cheese, salad, olives, houmus, chips and dips at only £8 for two, but I suspect you'd need a hearty appetite to manage a main dish afterwards. From the main meals we tried a vegetable chilli on a bed of rice, which was delicious but very filling, and fajitas with roasted marinated vegetables served with salsa, soured cream, refried beans and tortillas. Again, the food was fresh and delicious – and there was plenty of it. Main meals cost £7 and other dishes on offer include traditional Mexican fare such as tacos filled with vegetable chilli served with salad, salsa, soured cream and refried beans or guacamole; enchilada (tortilla filled
with spicy vegetables, spinach and cheese, topped with salsa and cheese, then baked) or chimichanga (tortilla parcel filled with spicy vegetables, then deep fried and topped with cheese and salsa).

If you prefer to go for a non-Mexican option, you can choose from spinach burger topped with sweet mango chutney and served in fresh baked bread, blue cheese burger topped with tomato and basil salsa with cheese or spinach and cottage cheese cannelloni baked in a creamy sauce. Given the generous portion sizes, you are likely to be more than satisfied with a main dish on its own, but if not there are plenty of appetising side dishes on offer as well. Chips, olives, tomato and mozzarella salad and jacket potato are just some of the extras available.

After our substantial first courses, we still managed to find space to sample a dessert: the homemade ice cream was delicious – and a bargain at £2.50 – while the blueberry and crème fraîche tart (£4.25) is also recommended.

Other desserts on the menu included chocolate nemesis and baked lemon cheesecake, both served with either cream or ice cream. Filter coffee to finish cost just £1.

The friendly chef mentioned that, due to the cafe's popularity, built up through word of mouth over eight years, they have plans to expand and extend the space available for diners. This is good news for anyone living nearby, particularly those of a vegetarian persuasion.

The bill for our three course meal for two came to an amazingly good value £31.25, excluding optional service charge, plus the cost of the bottle of wine we brought from home. Highly recommended.

The Cheerful Chilli Café, East Chevin Road, Otley, West Yorkshire, LS21 3DD. Tel 01943 466567. Open Tuesday to Saturday evening. Booking recommended. It is possible to book the whole café for an event for a minimum of 20 people. www.cheerfulchillicafe.co.uk