Osteria is my favorite restaurant in Madison by a mile. The food is always well executed, seasonal and inventive. They dish up some pretty authentic, rustic Italian fare. They serve a pretty good lunch, but to get the full experience make sure to get there for dinner.
They have a regular printed menu, but make sure to order a few things off their list of daily specials; it's where the food really shines. There are usually a few apps, mains and maybe a dessert. The specials tend to be crafted from whatever Francesco found at the market and I've never had a bad dish. Osteria also tends to be one of the few restaurants where I'll spring for dessert.
The restaurant is small, doesn't take reservations and can get packed early. Don't let that deter you, the wait is worth it. Otherwise, try to snag a seat at the bar for a delicious cocktail and some of the best charcuterie in town.