During an excursion in the town, the guides will tell you a number of fascinating tales about an ancient stronghold, its ruler, and an enchanted princess. The ruined castle, overlooking the most spectacular panorama of the town, is a site favoured both by townspeople and visitors. The castle ruins have also become a venue for an annual event – the Great Latgalian Market. Some legends tell us about the Ludza mediaeval castle:
In days long gone by, a major part of the Latgale land belonged to a mighty German feudal lord Volkwin. His residence stood high up on the Volkenberg (Mākoņkalns, or Padebešu Hill) near Lake Rāzna. The lord had no male heir, and after the parents' death the vast lands were inherited by Volkwin's three beautiful daughters – Rosalia, Lucia and Maria. The property was divided in three; each of the ladies had a castle built in the middle of her estate, and called it in her name. Later those names were also referred to the towns which grew around the castles. Thus Rosalia founded Rositten (Rēzekne), Lucia gave a name to Lucyn (Ludza), and Maria – to Marienhausen (Viļaka).
. Another legend says that once there were two sisters – Lucia and Rosalia. They resolved, each of them, to build a castle, and selected suitable locations some 20 miles from each other. They gathered huge piles of fieldstones and set to work. The sisters had, however, but one trowel between them. They took turns to use the tool, and kept throwing it to each other every now and then. There was one throw that Rosalia did not aim quite as well as she wished, and the trowel, flying past her sister, hit the ground with such strength that Lucia could hardly pull it out. The Small Ludza Lake was formed in the place where the trowel handle landed, and the Large Ludza Lake filled the dint made by the blade. Look carefully and you will clearly see those shapes in the present contours of the two lakes.
However, those are but legends. The Livonian Order, in fact, built a truly impressive fortress. It had the central castle; a convent building was put up later. The castle had two foreburgs, and its high walls of stone or timber were surrounded by the two lakes and deep moats. Only the impressive ruins have survived till these days, and tower above the ancient town of Ludza.