Nyaung-U's morning market is the most local thing you can do in Bagan. It runs from before dawn until mid-morning and draws vendors and buyers from the surrounding villages. Produce stalls sell tomatoes, chillies, and longan fruit; dried fish and shrimp paste fill one corner with a distinctive smell; monks move through in single file collecting alms.
The food stalls along the market's edge serve mohinga (fish noodle soup), shan noodles, and fried snacks for next to nothing. This is where the drivers and guides eat their breakfast. Arrive by 7am for the full atmosphere; most of the activity is over by 9am when the heat sets in.