Furthermore, the Venetian administration, whose seat was the fort, could more easily exercise control over the town. When the Venetians decided to establish the capital where it is situated today, they designed it on the model of their own towns.
They thus applied the principles of town planning of medieval Europe, and so effectively that the result is more faithful to that layout than in any other capital city of the Ionian Islands. A characteristic of medieval towns, present also in Lefkada, is the human scale – an element of great value sadly lacking in modern town-planning. The layout of the town’s historical centre resembles a fishbone: the central axis, the Agora or Pazari as it is called today, cuts through in a north-south direction, and plays an important role in the conduct of daily life in Lefkada. The side streets (alleys called sokakia), perpendicular to the Agora, are connected by debouching into narrow streets running parallel to the Agora. Street blocks are formed in such a way as to favour parallel lines in a north-south direction so as to expose the town to the ventilating action of the north winds for reasons of hygiene. The street blocks are also favourable for the creation of gardens round the houses, which embellish the layout of the town by making nooks of greenery that look like a stage set.
The town began spreading to the right and left of the Agora (the market street). Until World War II, the town limits extended almost up to the church of Aghios Minas, and from there on were the inns where the farmers used to leave their beasts of burden when they came into town from their villages to market and for errands. The town grew from the end of the market in recent times, to form the quarters of Neapoli among others. Until the major earthquake of 1948, in the neighbouring area of Kouzounteli, other than a few country coffee houses – facing Pefaneromeni Avenue - there was the refugee settlement of the Greeks who sought shelter in Lefkada Island in the aftermath of the Asia Minor catastrophe of 1922. After the earthquake and re-building of Neapoli, the town began to expand to the west, on the site of the refugee district and beyond, into the olive groves (Kampos) towards the seaside of Gira and Ai Yannis.