The food in Shangri-La is half Tibetan, half Yunnanese Han. The Tibetan side runs to yak meat (steamed, dried, in dumplings), tsampa (roasted barley flour), yak butter tea, and momos. The Han side, mostly in the new town, runs to standard Yunnan cooking — mushroom hotpots in season, rice noodles, the spicy and sour flavours of southwest China. Several restaurants in the Old Town now do a cross-cultural fusion of the two for the tourist trade, with mixed results.
A note on altitude: at 3,200 metres, alcohol hits harder than usual and digestion slows. Eat lightly the first day and ease into the yak.