I love Bang! - cute, great food and good service. Also, Sushi Hai is good but the service is definitely to be desired....
Right outside of Highlands area is Pagliacci's - wonderful Italian food and great atmosphere.
For breakfast, Kyle's on Tennyson is super yummy - simple and small but great diner style food.
Parisi is great for either lunch or dinner - Italian bistro style cuisine.
I live in Boulder so don't get to Highland all that often and haven't been to some of the new places in this increasingly popular dining 'hood. So hope others chime in too.
Duo has great food (incl desserts). - www.duodenver.com
Bang! is pop-arty w/ comfort food and also a good back patio - www.bangdenver.com
Highland's Garden Cafe has one of the best patios in Denver and is idyllic in warm weather - www.highlandsgardencafe.com
Pasquini's is a long-running, family-owned Italian restaurant w/ reasonably priced fare - www.pasquinis.com
Venue is a casual American-ish bistro that I have heard some good things about - http://venuebistro.com/
Root Down is a new, oh-so-hot eatery that I haven't been to either but has been getting both good and bad buzz (the latter fr Westword restaurant critic Jason Sheehan, who hates it) - www.rootdowndenver.com/
I didn't like it either...will wait to return until after the hype dies down.
Bang! and Venue I both really liked if not quite loved (not that that's fair to Venue; we only nibbled). In the same general area, I really get a kick out of Billy's Inn, former dive bar that shook the dust off last summer, and was charmed by Intrigue.
As always it depends on what you're looking for; the majority of these are contemporary American with varying levels of casualness; Intrigue's pretty classic French. Claire provided some of the weblinks, here are some others as well as to a few blogposts about each:
Denver Post restaurant critic Tucker Shaw reviewed Shazz today (http://www.denverpost.com/food/ci_120...) and praised the food to the skies. He had some reservations about the service -- not bad, but not as perfect as he would wish for the price. Shaww is not in Highland but nearby.