Dalaran

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The Magical Kingdom of Dalaran, also known as the Magical Nation of Dalaran, is a magocratic city-state which exists within Alterac Mountains (formerly Alterac) of northern Eastern Kingdoms. Its leaders rule the single city. Recently the city, including the Violet Citadel, has somehow been moved to the icy land of Northrend. Ruled by the Kirin Tor, Dalaran is one of the original seven kingdoms originating from the days of the Nation of Arathor. Since its foundation until Arthas laid siege to the city, and brought about its destruction, the Violet Citadel had served as the focal point for magi and the study of the arcane throughout human history. The kingdom's national color is violet, and its flag is a yellow or possibly golden eye set against a light purple background.

Dalaran is Wrath's neutral city, similar to the Shattrath of Burning Crusade. The city is classified as a Sanctuary, meaning that no PvP is allowed within its walls. Like Shattrath, opposing factions in Dalaran have separate sections. This time, however, the quarters are divided between Horde and Alliance, rather than neutral factions.

From WoWWiki:

Dalaran was one of the original city-states founded during the Arathorian empire. Since its inception, the city has served as a hub of magical knowledge and experimentation in Lordaeron and the world. A multi-racial wizards’ council called the Kirin Tor ruled the city for centuries, overseeing Dalaran from the Violet Citadel — a great, slender spire in the city’s heart that housed the most extensive libraries and greatest laboratories in the world. The traitor Prince Arthas laid siege to Dalaran in the Third War. He murdered its citizens, including the great archmage Antonidas, and broke into the city’s heart. His ally, the lich Kel’Thuzad, then summoned Archimonde, the Burning Legion’s leader. Archimonde wielded foul magic to topple the city’s towers and sunder its walls. Shortly after Dalaran’s fall, the undead abandoned the city to the wind and mist. Months later, a resistance force led by the surviving Dalaran wizards arrived and laid claim to the ruins. Pooling their magical power, the wizards covered Dalaran in an opaque magical sphere. It is unknown what occurs beneath the dome and the wizards warn others not to get too close.

The second city of the Nation of Arathor, Dalaran was founded in the lands northwest of Strom. Many fledgling wizards and magi who left the restraining confines of Strom behind traveled to Dalaran, where they hoped to use their new powers with greater freedom. These new settlers used their knowledge to form the enchanted spires of the Violet Citadel on Cross Island just ouside the city of Dalaran, and reveled in the pursuit of their studies. The citizens of Dalaran built up a bustling economy under the protection of their magic-using defenders.

Yet, as their numbers and influence grew, more and more magi practiced their arts, the fabric of reality around Dalaran began to weaken and tear, allowing demons of the Burning Legion into the world. These invaders caused havoc in the streets and countryside of Dalaran, despite the efforts of the Magocrats, the ruling archmagi, to deal with the problem. Fearing revolt and military action from Strom, the rulers of Dalaran turned to the high elves. The elves were able to determine that the daemons which had been summoned could be dealt with, but a more permanent solution was needed. The Magocrats entered into a deal with the Convocation of Silvermoon, and the Order of Tirisfal was founded.

Under the vigilant watch of the Order, Dalaran became the chief center of learning for magicians throughout the land. The Magocrats founded the Kirin Tor, a specialized sect and ruling council that was charged with cataloging and researching every spell, artifact, and magic item known at the time.

During the Second War, Dalaran pledged to support the Alliance of Lordaeron and gave large amounts of aid, mages, and sorcerers to the war effort. It was home to the four towers, sanctum to the lands' greatest sorcerers. The city was ravaged by the Horde, but was able to be rebuilt to its former glory. It was later attacked again for the Eye of Dalaran.

Prior to the Third War, the Violet Citadel was now within the city. Dalaran was the home of an incredibly large library of books and tomes, in addition to many of the greatest sorcerers of the day including Archmage Antonidas, Khadgar, Jaina Proudmoore, Arugal and Kel'Thuzad. It was also the site of the vault where the staff of Medivh, Atiesh, was kept after the master mage's death. However after the Scourge was unleashed upon the land, one of their primary targets was Dalaran. The city was defended by Dalaran Guard Towers and archmagi, but was ultimately destroyed following the summoning of Archimonde to Azeroth. The great demon single-handedly laid waste to the city by creating a magical effigy out of the dust, which he then crushed; the mighty towers of Dalaran fell simultaneously. Soon after the defeat of the Burning Legion, however, Alliance forces under the command of Grand Marshal Garithos regained the ruins of the city; some refugees from Lordaeron eventually made their way there as well.

The surviving magi of the Kirin Tor later returned with the intent of rebuilding, and erected a large, magical time-and-space distortion field around the city to ward off a new attack while they slowly regained their strength. The shield is opaque and completely impenetrable by any known means. Now the lands around the ruins of Dalaran are the site of a guerrilla war between the Alliance and the Forsaken.