Where to Stay
Everyone looking for a wild time either stays at Pachamama or Naked Tiger (these are probably the craziest hostels I have ever stayed at). The former is in the city and close to all the bars and restaurants. They have events every night and everyone usually goes to the same bar upon closing. The latter is outside of the town but has shuttles to and from it every hour (so that is not a big concern). Naked Tiger guests tend to get out less and therefore become really close with each other (has somewhat of a Real World feel). I would recommend trying both out since each hostel parties equally as hard but are both very unique in their own ways. Those who want to get some sleep stay at Iguana Lounge, Casa Oro, Surf Ranch (outside of town) or Casa de Olas (beside Naked Tiger and has an infinity pool).
Where to Party
Most nights Iguana Bar is the place to party once the hostels are empty. This is an awesome bar overlooking the beach where people can dance near the bar or talk on the large patio. Some nights other bars near the beach are the places to be (such as Howler’s) but you really just have to keep your ear out and follow the crowd.
I would also highly recommend the Dirty Crawl, which is a pub crawl that runs twice a week and attracts tons of male and female backpackers (look for signs all over town or ask workers at Iguana). However, the biggest party attraction in SJDS is the Sunday Funday Pool Crawl, so make sure you are there on a Sunday.
It is run by Pachamama and Naked Tiger and costs $10 to join (you get a free tank top too). They take you (and so many other travellers) to several awesome pools around town during the day where everyone drinks A LOT and things get very rowdy until it ends the next morning. While you can certainly meet a good amount of locals in SJDS, it is mostly a place for backpackers to connect.
The bars/clubs here actually play decent music. Since SJDL is on the Pacific side, you don’t hear the typical Reggaeton/Bob Marley everywhere. Clubs play somewhat up to date music, including some decent electronic. The hostels (and later in the Sunday Funday day) will often play some great deep house/techno and may take requests of this nature as well.
During the Day
SJDS is a quiet (only during the day!) surf town with several beautiful beaches. Get a cheap lesson or wait around all day for the parties at night like most visitors do. It is such a great place for backpackers because it doesn’t attract too many vacationers, families and hookers (see Tamarindo).