From a school fronting the village plaza comes the bubbling sound of children's voices. Across the way, some men are drinking beer at the Carretas Bar. Nearby, two women leave church after praying.
This village of whitewashed houses clinging to a hillside studded with olive groves seems, on the surface, like many others in Spain. But its size is an illusion.
Like a Hollywood set, many of the houses are empty. In the span of a generation, its population has plunged from 1,100 to 320 as residents moved to the cities for jobs, mirroring Spain's transformation in the last half a century from a primarily rural society to an urban one.
Now, Penolite's mayor has come forward with a bold plan to save the village from withering to extinction: Give $1,400 rewards to couples who have babies, and sell land at cut-rate prices to induce outsiders to move in.
"It's a question of survival," said Mayor Juan Maria Rodriguez, whose family has lived in Penolite (pronounced peh-nyo-LEE-teh) for generations.
Since the offers were made in January, a dozen people have moved to town and six village women have become pregnant. Although most of the women deny that the cash motivated them, Rodriguez believes that the money is prompting couples who were thinking about having a baby to do so.
But skeptics say Rodriguez's strategy, like perhaps Penolite itself, is doomed.
"There are no jobs here," said Petra Guirado, a mother of four grown children, as she walked alone on one of Penolite's narrow streets. "My kids would never have left if they could have found good jobs here. What are the newcomers going to do?"
Penolite is dependent on the heavily subsidized olive oil industry for jobs. And the subsidies, provided by the European Union, may soon be cut.
Unless you're the only bartender, storekeeper, teacher or doctor in town, there's little employment outside of harvesting olives and pressing them for oil. The work lasts only four months, providing enough for a family to get by, but little else for the more ambitious.
But Rodriguez's efforts are not only bringing new people into the village, they're bringing fresh ideas.
Antonio Martinez, 35, was unhappy with his job as a window fitter and with living in a crime-ridden neighborhood in the city of Algeciras when he heard on TV that Penolite was seeking newcomers.
"I got out a map, found where Penolite is, and took a gamble and came here," said Martinez. He brought his wife, his three children, his father, his sister, her husband and their two kids.
While the children attend Penolite's one-room elementary school, the men are trying to make a go of it by growing organic tomatoes and raising chickens and goats for sale. The regional government is lending them the land in exchange for a share of any profits.
Meanwhile, the newcomers are living in a cramped rental house. If things go well, they'd like to build their own homes and stay.
Local residents have quickly accepted them.
"They are hard workers. We need more people like them here," said Juan Maria Bustamante, owner of the Carretas Bar.
As evening fell and a full moon hung above a ridge outside town, Bustamante walked outside his bar and stood on the plaza. The clank of goat bells drifted up from a valley below.
Bustamante moved to Penolite seven years ago with his wife, a native of the village, leaving his job as a waiter on the resort island of Ibiza after growing tired of the fast pace and high cost of living.
"It's tranquil here," Bustamante said. "In the morning, the song of birds wakes you up. They are our alarm clock. It's beautiful."
But Bustamante worries that Penolite's days are numbered unless the population decline is reversed. Five years ago, the village had three bars and three stores. Now there is only one of each. Residents go to a larger town three miles away for most goods and services.
"I hope these newcomers stay, and that more arrive," Bustamante said. "If they don't, all the rest of us may be out of here before long."