Questions & Answers about Хотя ночью было холодно, у костра нам было тепло.
Yes. Хотя means although / even though.
So:
- Хотя ночью было холодно = Although it was cold at night
- у костра нам было тепло = we were warm by the campfire
It introduces a contrast: the night was cold in general, but near the fire, the speakers felt warm.
Ночью is the instrumental singular of ночь (night), and in Russian the instrumental is often used in expressions of time meaning during a certain part of the day or year.
So:
- утром = in the morning
- днём = in the daytime
- вечером = in the evening
- ночью = at night
This is a very common pattern, and it is best learned as a set expression.