Yes, this is real. It's called Telluride Balloon Fest and it happens annually. This year the balloons launched early in the morning from Town Park and flew down Main Street. I was lucky enough to have an amazing view right from our apartment - aka I could stay in my pajamas and watch the whole show. Later in the evening, the balloons formed a line on Main Street and lit the town up. A few friends and I climbed up on the rooftop of an apartment, had a cocktail, and enjoyed the glow (and even heat) from the balloons.
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^^ Night glow on Main St. ^^
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