The Prancing Pony was the main Inn of the town of Bree. In addition to providing beds and meals for travellers, the Inn also served as a meeting place for the local townsfolk. While most rooms at The Pony were used by Rangers and dwarves, there was also a wing with rooms specifically designed with hobbits in mind.
The Inn was also notable for serving good food and excellent beer, at one point made better by an enchantment from Gandalf. The Inn had been owned by the Butterbur family since its start, with Barliman Butterbur the innkeeper at the time of the Lord of the Rings. Due to the status of the Inn as a meeting place, Butterbur was considered an important person in Bree.
Aside from Barliman Butterbur, the hobbits Nob and Bob worked at the Prancing Pony; Nob typically taking care of the guests while Bob worked as a stablehand. Gandalf, Strider, and Tom Bombadil were regular guests at the Inn, and it also hosted Frodo and Company during their trip to Rivendell. In addition, it was where Gandalf and Thorin Oakenshield had a chance meeting that would eventually lead to the downfall of the dragon Smaug.
The Prancing Pony is located in the north-east corner of Bree. There are a number of quests started by or involving Barliman Butterbur. In addition, Aragorn and Gandalf can be found staying at the Inn as part of the first book of Epic quests. While Nob can be found fetching water for the Inn, Bob is located near the Barrow-Downs, having set off to search for his daughter. The Inn is also the subject of one of the skirmishes, the aptly named “Defence of the Prancing Pony.”
The Prancing Pony also offers the services of a barber, a bard, and a Minstrel class trainer in addition to the standard Tavern Keeper and Healer vendors, with a Milestone and mailbox located just outside.
During the stay of Frodo & Company on their trip to Rivendell, The Prancing Pony was attacked in the night by agents of the Black Riders, likely including Bill Ferny and Harry Goatleaf. The Inn suffered from a lack of business when ruffians and bandits began operating in the Bree area, but customers began returning when Frodo & Company came back from the events “away south,” as the Bree-folk called it.