As English Heritage, the government's conservation agency, has pointed out, too many people do them badly, destroying the character of the buildings. "Horror conversions", as Simon Thurley, EH's chief executive, calls them, are arguably worse than leaving these honestly functional structures to decay with dignity. But the best kind of conversion reveals the nobility of their character without resorting to witless historical pastiche. Which is where this conversion in Northamptonshire, by architect Simon Conder, comes in. It represents the very opposite of the surburban approach decried by EH.

If you asked me where Pinions Barn is, I would be unable to tell you exactly. I know it is about half-way between the cities of Milton Keynes and Northampton. I also know that it is between the M1 and the main London-Edinburgh railway line. But when you get there, after a network of roads and lanes have finally ended in a rough track on windy rural uplands, you might as well be in the most remote corner of England. A collection of farm buildings looks across a green valley to a church spire in the distance. The occasional rush of an express train in the middle distance somehow only enhances the feeling of isolation. Here Conder - famous for his black rubber-clad house on the shingle of Dungeness, and so a man well accustomed to fringe locations - has got to work to create a country retreat for a London family.

The original farmhouse next door, in different ownership, is now separated from the barn complex by a traditional new wall in the honey-coloured local stone. That leaves three buildings - two long barns, one tall, one low, and a third tumbledown building roughly at right angles to them. Because the two barns splay out from the original farmhouse, this leaves a near-triangular courtyard between them. Conder's plan was simple: the big barn would become the parents', the smaller one the domain of the teenage children, and the courtyard between would become a lake, crossed by a bridge. Finally, the tumbledown shed would be replaced with a new swimming-pool building of the same size. But costs had to be reined in, so the pool building will have to wait.

It's been done on a pretty tight budget for such a lot of space - cost per square foot came out at £158, which is pretty good value. Plenty of residential projects cost twice that. So despite the fact that the main barn was virtually derelict to start with, the whole project cannot have been much more than £650,000.

There was an original planning permission to divide the big barn up into lots of rooms with lots of roof windows. Conder was having none of that. He likes big spaces and unbroken roofs, though he allowed himself a discreet section of glazing above his rather remarkable stair. This proves one of the great axioms of architecture - to get the best effect, don't spread all your money equally. Spend more on one or two key elements, and nobody will notice that things are much less lavish elsewhere.

The staircase is right opposite you as you enter from the courtyard. Made of two-inch-thick slabs of precisely-jointed oak, it spirals upwards, entirely self-supporting, without even a central pillar. It is enclosed, if that's the right word, by tall freestanding segments of curved toughened glass. A handrail follows the stairs upwards, bolted directly to the inside of this glass tube. It is virtuoso stuff and demanded precise manufacture, so while all the rest of the woodwork in the building was done on site, the staircase was made by specialist joiners in Warwick.

Only one end of the barn has a first floor, and it contains two bedrooms - one a guest room at the end, the other - via a bridge landing over the hallway below - the main bedroom, complete with open-plan bathroom behind a low wall of storage. Because this room is up in the roof, it has no outlook. Its "window" takes the form of a glass balcony overlooking the main living space that takes up all the rest of the barn.

This is huge. One thing about many barns which makes them feel different from any other kind of home is that they tend to be very long and relatively narrow. Wagons used to move in and out through big doors in the middle. And this particular barn - which Conder reckons dates from the 1840s - was at one point extended to make it even longer. That makes it 112 feet by 21 feet. The extension was probably a hayloft, and always had an upper floor. The older part did not. So the layout of Conder's house echoes the original agricultural design. Which means in turn that the main, full-height living/dining/kitchen area is a not very small 61 feet long, 16 feet wide and 19 feet high to the peak of the exposed roof.

Conder has kept many of the original openings, including one that he tidied up to make a big circular high-level window. There are exceptions, however. Here it is the long, long horizontal slot of glass which pierces the wall on the east side, behind the kitchen area. "In all our projects there is one truly perverse detail," says Conder with pride, "And this is it."

It looks impossible - a huge chunk of ancient masonry wall seemingly hovers over nothing at all. The window slot is an uninterrupted 18 feet long. It was inspired by the trains that whoosh past, a field's distance away. Not that you can see the trains - a hedgerow across the lane prevents that. Conder talks of trying to create an equivalent slot in the hedgerow. This, I think, is horticulturally impossible. As for the hovering wall over the window, that was made possible by the fact that such old barns have thick walls with a rubble filling. Conder simply replaced the rubble filling at this point with a concealed concrete beam.

His other clever trick was dealing with the incredibly uneven walls. The barn leans and bulges all over the place. To cope with this - and with all the pipes and wires, and with the need to insulate it snugly - Conder has lined both flank walls of the building with thick inner walls faced in birch ply. The old stone walls are however left visible at both ends, while the warped, wormeaten roof trusses are on full view. At a stroke the inner lining straightens everything up and makes it habitable, and warm, for the 21st century. All kinds of things happen in it, from storage to concealed light fittings.

The ground level is floored in Portland limestone - which is also used, three inches thick, for the colossally long kitchen worktop (18 feet again, lined up with the window), and the hearth to the giant wood-burning stove at the end of the room. Underfloor heating keeps things warm otherwise. Upstairs, the floors are in light oak.

The original idea was to flood the courtyard between the two barns completely. Too expensive - but there is still a large pond, and a bridge crossing it. The smaller single-floor barn for the children, which was in much better condition to start with, is a simple low-budget conversion with two bedrooms, a bathroom and a large living space/games room. The big move there was to remove a whole chunk of its wall and replace it with glass, so opening up the best view across the valley.

It's always interesting when modern meets ancient. Although early 19th century, this barn might as well have been medieval, so little had farming practices altered in between times. Such old agricultural buildings, with their big open spaces, look incredibly up-to date in some respects. And what is that glass balcony for, if not minstrels? So here at Pinions Barn you have a way of living that goes right back to the great halls of old England. Which surely means that it is just the best house for a party ever. Who said modernists couldn't pull a pint?

Simon Conder Associates, architects: www.simonconder.co.uk