The waterfront Handicraft Market near the main post office is the obvious first stop for souvenirs. Stalls are stacked with batik cloth, pearls from Sabah's island farms, rattan basketry, wooden carvings, beaded jewellery from the Kadazan-Dusun tradition, and the ubiquitous orangutan plush toys. Quality varies considerably — look past the generic items at the back of the stalls for the more interesting handmade pieces.
Prices are negotiable and sellers expect bargaining, though not aggressive haggling. If you are buying pearls, ask to see the raw strands and look for even colouring and lustre rather than uniform size. The adjacent night market runs from around 5pm and specialises in cheap local food rather than crafts.