The last thousand miles of South America are a brushstroke, ending with a flourish at Cape Horn, where the Atlantic and Pacific meet. Yet off to one side, you notice a small group of islands, as if one last drop of ink had fallen, half forgotten, from the brush.

The flight to the Falkland Islands from Santiago de Chile tracks the mountainous spine of the Andes south to Patagonia before turning east for the last hour over open sea, arriving in a land that looks in many places almost like Britain. There is a red telephone box in the centre of the islands’ capital, Stanley. You can order curry and chips in a pub, which isn’t bad considering that you are already nine tenths of the way from Britain to Antarctica. Even the landscape could pass as one of the emptier reaches of Scotland’s Western Isles. But you can only take such comparisons so far: like when you see the first penguin.

The Falklands are home to five species of penguin: kings, gentoos, Magellanics, rockhoppers and the rarely-seen macaronis. There is something surreal in the congregations of flightless birds, as they seem to stand and wait for an important event that never happens. Like much of the wildlife here, they have made their home on a rare piece of land in an ocean rich in krill, squid and fish. Nowhere else are there so many of them living alongside a settled human population.

Apart from cliff-dwelling rockhoppers, penguins prefer grassy land by a beach for their colonies. For the one large human colony on the islands, the settlers chose a wide harbour, half-sheltered from the winds that whip around these southern latitudes. Nearly 170 years since it was founded, Stanley still has a pioneer feel to it. Weatherboard walls and roofs made of galvanised iron – known as ‘wriggly tin’ – are the building materials of choice. Plots of land are given over to vegetable gardens, horses crop the grass behind picket fences, and almost every vehicle that passes is four-wheel drive. For all the touches that suggest a piece of Britain in the southern hemisphere, there is also something Scandinavian in the red, white and green houses standing out against the muted landscape. Scattered farm settlements once defined island life, but now almost all Falklanders live and work in Stanley. A bank, a petrol station, a hospital, and a junior and senior school meet local needs, although there is more choice when it comes to eating out. There is even an annual horticultural show and, judging by the flower beds, keen competition.

By the waterfront, fronds of kelp wash in the waters of the South Atlantic. Stanley Harbour grew as a haven for ships mauled by storms while rounding Cape Horn, 500 miles away. The Lady Elizabeth limped into harbour in 1913 on her way from Vancouver to Mozambique, the year before the opening of the Panama Canal provided an alternative to the Cape Horn route. Today, she lies listing in the shallows of Whalebone Cove, on the fringes of Stanley Harbour.

Stanley may be no bigger than a large village, but it feels like a metropolis compared with ‘camp’ – the term for anywhere outside the capital. Fewer than 400 Falklanders live in an area roughly the size of Yorkshire.

Seventy miles from Stanley is the biggest camp settlement, Goose Green, and its near neighbour, Darwin, which preserves the name of the young naturalist who visited here on the HMS Beagle in 1833. Goose Green, however, was a name little known outside the Falklands until 1982, when for 74 days the islands found themselves at war. It was here, at the pinch-point where the two halves of the island of East Falkland meet, that some of the heaviest fighting took place between British and Argentinian forces. Memorials to soldiers from both sides dot the countryside, and the otherwise pleasant half-hour walk from Darwin to Goose Green passes several minefields left over from the conflict.

The minefields barely bother the locals. Covering less than 0.2 per cent of the Falklands, they are all signed and fenced off, and there has never been a civilian casualty. Many say they would rather any money was spent clearing landmines in more vulnerable countries. Yorke Bay is one of the closest suspected minefields to Stanley. While visitors watch from behind a cordon, light-footed gentoo penguins enjoy free rein of this fabulous sweep of pale sand and accidental nature reserve.

Further north, a drive past outcrops with names familiar from the 1982 conflict – Mount Harriet, Tumbledown – and then an hour across open moorland leads to Volunteer Beach. Unlike Yorke Bay, this one is shared by both penguins and humans. As I approach the dunes, perspective tricks my mind, and the backlit figures of both species appear to merge in the midday sun.

Most of the thousand-odd king penguins huddle in a colony just inland from the dunes. They are certainly the best-dressed penguins, and the smaller Magellanic penguins that walk past resemble gatecrashers at a black-tie cocktail party. The king penguin’s image of regal detachment is spoiled by its trumpeting call, which sounds like someone stepping on a squeaky toy. On closer inspection, tempers are fraying at the party as the guests invade each other’s personal space. King penguin society is kept in line with a few well-placed wing slaps and beak jabs, and some in-your-face trumpeting.

The biggest concentration of wildlife on the islands, however, is on Sea Lion Island, nine miles off the shore of East Falkland. The sea lions here are not the sleek, barking creatures of Hollywood, trained to balance beach balls on their nose. The roar of the adult males and the mane that grows around their huge heads are respectably lion-like. Looking down from the cliffs on the southern side of the island, the inequalities of the animal world soon become apparent. One beachmaster bull – the alpha male of the species – sits among his harem, while another, slightly smaller male, lies alone a dozen yards away, resting his chin on a slab of rock with the look of a scolded dog.

At dawn, I walk the short distance from the lodge to the beach at Elephant Corner. Elephant seals are even larger than sea lions. Two or three people could lie end-to-end next to the largest bulls, if they were feeling reckless. They look almost prehistoric, like the first draft of a seal. They lie snorting, harrumphing, scratching their bellies with their flippers and dusting themselves with sand. Two bulls slam their necks against each other in the rolling surf for more than an hour while the fins of killer whales rise out of the water beyond.

If you ask nicely, your pilot may dip the wings of his plane to give you a better view of any whales he can spot. This is one of the small joys of island-hopping on one of the five bright-red passenger planes run by FIGAS – the Falkland Islands Government Air Service. It feels more like a local bus route, as passengers hop on and off along the way to outlying islands and remote camp settlements.

Port Stephens is one of the larger farms on West Falkland, and an example of an enduring but threatened way of life. Coming in to land, the pilot radios ahead to Ann and Peter Robertson to bring the Land Rover with the fire-fighting equipment – just in case – and check that none of their 11,000 sheep has strayed onto the grass airstrip. Peter’s family came here in 1908 when wool was the only significant business on the islands, and a farm like Port Stephens could support a flock of sheep 70,000-strong.

‘When I was first here, you probably left the farm only once a year,’ he says. In the old days, deliveries came by boat to the jetty just a few steps from his front door, but now the farm is linked by road to Fox Bay – a three-hour round trip. Before the arrival of telephones in the 1980s, remote camp settlements would pass messages around by radio as everyone else listened in. It created an odd kind of community spirit, despite the distances between farms. ‘Even if you’d never met someone, you’d know them from the radio,’ Ann says. ‘You’d even know if they were desperate for a nightdress.’

The cliffs and headlands around Port Stephens make up some of the most dramatic terrain in the islands. Climbing a hill to get a better view of a colony of rockhopper penguins, I discover that sheep are among the most skittish creatures in the Falklands. Even a cautious approach sends them bounding across moors covered by clumps of waxy, red diddle-dee berries and strange cushions of balsam bog, like springy, living rocks. When safely far-off, they turn to fix me with what I take to be a taunting look. Returning to the farm, the tables are turned: perhaps a thousand sheep wait in a pen. The Robertsons’ son, Paul, enters the enclosure and they scatter in a fluid movement, like a shoal of fish escaping a shark. Ann and another herder drive the flock into a narrow channel, where Paul slides a gate back and forth, sending shorn sheep right and woolly left, into further holding pens.

When Stanley residents want a quick holiday, many take the hour’s flight to Carcass Island on the western fringes of the Falklands. In a way, it is to the Falkland Islands what the Falklands are to the rest of the world: on the edge of the map, home to remarkable wildlife, and a place that’s about as isolated as you can get before it becomes uncomfortable. The unfortunate name comes from the HMS Carcass, which surveyed these waters in 1767 and was named after a kind of early incendiary bomb. Carcass is free of rats and the tall tussock grass has not been overgrazed, which makes it a haven for birdlife.

Rob and Lorraine McGill have owned the island for nearly 40 years, and run it from a red-roofed bungalow sheltered by a palisade of Monterey cypresses. They lived on Sea Lion Island before, but found it too flat after the hills of the western islands where they both grew up, and to which they longed to return. ‘Every day goes by in a flash,’ says Rob. ‘I don’t suffer from boredom.’ With Brock, his collie, at his heel, he climbs the hill behind the house where his cattle are grazing. With great patience, he herds them back down into a pen, separating out the calves, and applying healing cream to some of the cows’ udders. There is no better day to be outside, overlooking the glorious sweep of Port Pattison bay and the scattered islands beyond. The landscape seems to be full of possibilities.

I ask Rob if he is ever tempted to take a boat out around his island. ‘If I had a boat I wouldn’t do any work,’ he replies. He borrows one from a neighbour, seven miles away on West Point Island.

The McGills vary the tracks they drive their Land Rovers along to help prevent erosion. Rob drops me at the island’s northern tip by the skeleton of a southern right whale. The bleached bones and brittle sheets of baleen, the colour of dark amber, lie among rocks patterned with saffron yellow lichen, pale clumps of sea cabbage and wild celery. Along the shore, a loud burp from the tussock grass announces the presence of an elephant seal. I keep my distance, then notice three pairs of eyes watching me. The inquisitive, eagle-like striated caracara is rare in most of the islands, where it is known as a Johnny Rook, but it’s common enough on Carcass. The official advice is to keep a respectful distance from all wildlife. It is hard to follow this rule when some of the wildlife seems determined to pinch your sandwich, test the resilience of your rucksack or simply perch on your head.

Back at the settlement house, the 10 guests sit down to dinner. One of them, Georgina Strange, is a Falklander stopping on Carcass on her way home to even more remote New Island, a nature reserve part-run by her family. She and her friends are preparing Marmite-spread crackers for the five-hour boat trip the next morning. Georgina will stay on New Island for six or seven months unbroken, working on conservation projects, with a supply boat visiting every six weeks. ‘It’s proper wilderness,’ she says. ‘I miss going out to cafés and buying magazines.’

A generation ago, the wool-based economy of the islands was in decline and its population slowly ebbing away. As a distant outpost of a largely vanished empire, the Falklands had an uncertain future. However, today’s islanders are less inclined to see their home as an outpost and have plenty to feel proud of – from their efforts to restore local wildlife to the self-reliance and sense of community you see everywhere. By their nature, the Falklands may always be in a fragile position, but its people are prepared for this. Georgina has lived in Britain and Australia, but like most young Falklanders today she is staying on the islands.

‘I think you have to live somewhere else for a while – it’s unhealthy not to. But I’d say 90 per cent of people come back. It’s the freedom more than anything. Cities are fine, but life gets annoying with all the rules. On my island, something really interesting happens every day, even if it’s only tiny.’

The article 'Where penguins outnumber people' was published in partnership with Lonely Planet Magazine.