Neighborhood volunteers and merchants will host the first ever Temescal Street Fair on Saturday, with three stages showcasing several local musicians. And, yes, there will be room to dance.

The street fair has been a dream of members of about a dozen community groups that have sprung up inside the Temescal district the past several years, Mostern said, groups such as neighborhood crime prevention councils and the local business improvement district.

"People in these groups looked at each other and said: 'We need to build a community identity and spirit,'" Mostern said.

So the fair was born.

For some, the street fair will be a celebration of the spirit of Temescal and its new Business Improvement District.

The City Council established the Temescal/Telegraph Avenue Business Improvement District at its final July meeting. The district taxes 211 property owners along Telegraph Avenue, from 40th Street to the Berkeley border, and properties along Shattuck Avenue.

The tax money will be used to beautify the historic neighborhood and make it an attractive shopping spot for people from all over the Bay Area, much like the Montclair and Rockridge shopping districts.

"Having a Business Improvement District will allow us to do (street fairs) on a more consistent basis and other things, such as streetscape improvements and area promotion," said Carlo Busby of the spiritual books and gifts store SAGRADA Sacred Arts.

Busby sees Temescal as a convenient place to shop and play. It is just south of Rockridge, close to Highway 24 and BART.

"It is an older neighborhood with a lot of history, and it has a lot of cultural diversity," he said.

The district was annexed into Oakland in 1887 and remained a vibrant community for decades. It was rediscovered in the 1990s by local artists, musicians and families after a period of decline.

Developers and home buyers have gambled their hopes on the area as well. The mix of 25 townhomes and lofts in Temescal Place -- the first new cluster of homes in the area in decades -- recently went on the market and sold almost immediately for about $500,000 each.

Businesses vary from the widely known Genova's Delicatessen to celebrated upscale restaurants such as Dona Tomas to adult book stores. Several new businesses, including a yarn store and a games store, have moved into the area. Several more businesses are expected soon, among them a Lanesplitters pizza restaurant and pub.

Alison Barakat's bakery, Bakesale Betty, will move into the neighborhood by the end of the year. Barakat has been selling baked goods at farmers markets in Danville, Walnut Creek and Alameda and wanted a permanent store.

"Our goal was to find a neighborhood that would welcome a business like ours, and we thought the Temescal neighborhood would be perfect," she said. "It's very quaint, there's a wonderful array of stores. A lot of the shops are unique and we're attracted to that."

The fair will be from noon to 6 p.m. Saturday. Activities will include art projects for children with Studio One and East Bay Depot, martial arts demonstrations, and an Italian wine and beer garden. Salsa music from Montuno Groove, hip-hop and funk from Otis Goodnight, and string music from Crooked Jades will be among the featured performers.

The East Bay Church of Religious Science International Choir will perform too, as will the children's musical artists Colibri and Asheba.