The Dalek City was the home of the Daleks on Skaro.
History
At the time of the Doctor's visit to the planet. It dated back from before the Thousand Year War. The Daleks lived not in the city itself, but rather below it where they thought they were shielded from radiation.
The entire city ran on static electricity, transmitted through metal floors, which the the Daleks of this era of Skaro history required to power their casings. As a consequence of this dependence, the Daleks were unable to leave their city. They were unaware that a group of Thals had also survived the neutronic war.
The city at one side had a natural protection in the form of the Lake of Mutations. Near the swamp was a lake where the Daleks got their water.
After the Daleks were destroyed, the Thals moved into the City. (DW: The Daleks)
During the war between the Humanized Daleks and the Daleks ruled by the Emperor Daleks, the Daleks had a city which, the Doctor having visited before, he knew how to navigate. Fighting between the two groups of Daleks devastated the city. (DW: The Evil of the Daleks)
- We do not know definitively how these stories relate to each other chronologically. Inarguably, the Daleks living in the city during his first visit had cruder technology. By the time of his second visit, the Daleks could move outside the city and had time travel.