Tartu is small enough that everywhere is walkable, so the real choice is between the compact centre and the wooden districts on either side of it.
Kesklinn — Town Hall Square and the river
The centre between the square, Ülikooli street and the Emajõgi: hotels, the bus station, and everything within ten minutes on foot. The most expensive base, and the loudest on Friday and Saturday nights when the student bars empty into the square.
Karlova — wooden streets south of the centre
A grid of single-storey wooden houses about fifteen minutes' walk from the square, with cheaper apartments and neighbourhood cafés. Quiet and residential, and the best value in the city if you do not mind the walk back at night.
Supilinn — 'Soup Town' by the river
The low wooden quarter north-west of Toomemägi, its streets named after vegetables, five minutes from the university buildings. Small stock — apartments and guesthouses rather than hotels — so book early or look elsewhere.
Practical: book around the university calendar
Tartu fills for graduation weeks, the student days in spring and autumn, and the WRC rally in mid-July (16–19 July in 2026), when beds sell out across the city. Outside those dates rooms are easy to find at short notice and cheaper than Tallinn.