"After the Grand Palais, I had to do the opposite," Karl Lagerfeld said, tongue only partially in cheek, at Chanel's Métier d'Arts show in Paris tonight. Indeed, the cozy, intimate proceedings landed at the end of the spectrum furthest from the grand-scale Spring 2011 spectacle that had dared you not to drop your jaw. For that matter, it was equidistant from last year's pre-fall show: a Shanghai extravaganza with a thousand guests taking it all in on a pontoon on the Huangpu River.

Instead, Lagerfeld had transformed the second-floor couture salon at the brand's iconic Rue Cambon store into a sort of Ottomanesque chill-out room, with low stained glass tables and two rows of patterned square pillows to seat the 136 fashion folk—mostly a hometown crowd—in attendance. It was so low-key it felt as if Uncle Karl had invited over a few friends—you know, friends like Inès, Diane, Charlotte, Tatiana, and Clémence. But you only had to look at the salon walls, entirely embroidered for the occasion in tiny bronze sequins, to know that intimacy doesn't equal skimping in the house that Coco built.

The season's theme, Paris-Byzance, Lagerfeld explained, was inspired by the Empress Theodora and the lost culture of Byzantium. In typically rapid-fire mode, he noted: "Theodora was a circus artist who became empress, like Chanel, who was a little singer and became a fashion empress." Ba-domp-bomp! Mostly, however, the reference came via Coco's Byzantine-inspired Gripoix jewelry, which is instantly recognizable even today.

Lagerfeld's take on it cross-pollinated the fifth century with sixties London. Call it "Granny Takes a Trip to Constantinople." These dolly birds wear their swingy navy peacoats trimmed with exquisite little jeweled buttons; their every square-heeled boot, black leather glove, and quilted handbag come encrusted with big glittering stones. And to upgrade that messy beehive: a filigree headband. The bohemia was possibly at its hautest in the amazing multicolored knits made decadent with gold thread, embroidered fringe, and chunky gold chains knitted right in.

For those modern-day empresses who are Chanel's clientele, there was some truly beautiful suiting meticulously decked out in more gold chains, braiding, jeweled buttons, feathers, and fringe. And for evening: either heavy jewel-tone satin with even heavier swaths of mosaic embroidery—as if you were wearing a chunk of a church, and we mean that in the best possible sense—or, on the lighter side, black silk edged with snaking stones. One of the strongest evening looks, a floaty and only moderately embroidered plum silk number, looks predestined for the red carpet. (Hope you were paying attention, Ms. Kruger.)

The Métier d'Arts show is about flexing the muscles of the artisans that the label has gathered under its umbrella. It's about the little black dress crafted from little silk and feather flowers using a level of craftsmanship that's almost gone the way of Byzantium. If last pre-fall was about recognizing the future, set as it was in the very market that every luxury label is trying its hardest to crack, then this, in a sense, was about recognizing the past. Even an inveterate anti-nostalgist like Lagerfeld knows that solidifying and celebrating Chanel's heritage is one key to remaining a powerhouse in the decades to come.