The White Horse of Kilburn and the Black Swan at Oldstead do not see eye to eye.

That's a pity because the visible presence of the mighty equine carving would complete a perfect scene. Is there pub dining in a lovelier setting on a summer's evening? Whichever route you take, it involves magical lanes twisting beneath canopies of trees and emerging into a hamlet where the Banks couldn't be friendlier towards customers, or further removed from convulsions in the city.

The family has lived and farmed at Oldstead for generations. One of their number helped to remove sods and earth before the White Horse was cut into the hillside a mile or so away. You can understand why today's two sons don't want to move away.

But how to earn a living in this southern corner of the North York Moors National Park? The solution was in the local, a run-down drinking pub with hardly any drinkers (the village has only 15 dwellings), and a long way beyond its chicken and chips in the basket days.

Tom and Anne Banks, who do bed and breakfast at their farmhouse 200 yards away, bought the Black Swan and reopened it two years ago this month with the standards which have earned their accommodation the maximum rating, a five star gold award under the Enjoy England Inspection Scheme.

Apart from the career opportunities it gives their boys – "we all value where we live and never want to leave" – Mrs Banks sees it as a chance to present quality food at reasonable prices, and wherever possible using produce from the area's abundance.

The menu emphasises that fact and the freshness of ingredients in homemade stocks, sauces, sausages, bread and puddings. All meat is British, and its sourcing is acknowledged, though no mention is made of the herbs, and some vegetables and fruit grown on the Banks's own 160 acres.

The menu could hardly be more specific and begins: "Thornton's Butchers of Easingwold supply us with beef, pork and lamb, which is from Larry Sigsworth's farm at Raskelf, Roger Donaldson's farm at Huby, Steven Wilson's farm at Sproxton and Ian Mosey's farm at Gilling." Before reaching their culinary contribution, you are in a place fashioned by more of the county's craftsmen. We don't know who was responsible for the building's 16th century origins, or who laid the stone flags, or made the bow windows, but Mousey Thompson of Kilburn produced the oak fittings – his trademark mouse is in mid-scurry on the edge of the bar – and the beer is Black Sheep from Masham and Copper Dragon from Skipton Brewery.

Where you choose to eat is up to you. The menu is the same whether you sit outside, in the simple but classy bar or upstairs in the restaurant. The pub being on a slope, it also opens onto the car park. For this room, the owners again rejected contract furnishings as "soulless", and found everything on eBay, from antique tables and chairs, to brassware. The lack of uniformity sits comfortably with the exposed wood floor and there are some nice personal touches. The food aims to serve traditional British dishes with a "modern twist". The head chef is Adam Jackson, who moved the few miles from the Rose and Crown at Sutton-on-the-Forest after helping it to win a Michelin Bib Gourmand. He appears to have brought followers with him. Passing trade in Oldstead is negligible so 30 diners on a Tuesday night was a measure of how well things are working.

The menu offered a choice of five starters and eight main courses, with vegetarian options. On an adjoining table, a woman with a knowledegable air enthused about the roast butternut squash risotto. Vegetarian and children's menus are also available and there are daily specials.

First courses included cream of celery veloute with homemade cheese straws, crab salad or smoked salmon platter. The lemon and herb marinated chicken with local asparagus, capers and parmesan shavings (£6.50) was light and individual flavours blended superbly.

Grilled goats cheese crottin with new season bobby beans, new potatoes and toasted hazelnut dressing (£5.95) looked a picture.

For all its support of local agriculture, the Black Swan does not let fish get away. There's sea trout, baked fillet of halibut, East Coast haddock, and, at £15.95, pan-fried fillets of sea bass with pea risotto, home-cured tomatoes and dressed pea shoots. The word back was "phenomenal." Copper Dragon braised beef en croute accompanied by creamed mash and buttered spring greens (£10.95) was a terrific dish, topped by triangles of delicate French pastry. Meat as lean and tender as this makes you appreciate the rearing skills being applied in the surrounding landscapes.

The layman can take them for granted, until a strange contraption growling its way back from the fields is a reminder of human hands still toiling at dusk. There's a strong range of wines and available by the glass. Among the puddings are warm apple tart with vanilla ice cream and caramel sauce and iced lemon meringue parfait with fresh berries, elderflower and Pimm's.

The cheese board has recently been extended beyond Yorkshire and offers specialities from Dorset, Gloucestershire, Ireland and Cornish Wild Garlic Yarg.

From our jolly and attentive waitress, to the Banks's son James, the front of house manager, (younger brother Tommy is learning in the kitchen), there's a youthful element, but a sense that overall standards and the eye for detail, emanate from mother. She blends efficiency with style. It's not everyone who can be calm in a crisis and crises don't come much bigger for me than when the machine for the debit card goes haywire and indicates our bill adds up to £67,301.73. Banks make mistakes, we know, but rarely do they rectify them
as quickly or with such charm as happened here.

"Oops, I do apologise, that should be £67.30." Phew!

The Black Swan, Oldstead, near Thirsk, North Yorkshire YO61 4BL.

01347 868387.

Food served Tuesday to Saturday noon-2pm, 6pm-9pm Sunday noon-2.30pm, 6pm-9pm Closed Mondays www.blackswanoldstead.co.uk