In Durarara!!, the Tokyo entertainment and commercial neighborhood of Ikebukuro blends this trope with the City of Adventure, with a bunch of gangs around, people cutting each other with knifes, Shizuo throwing random vending machines at Izaya everywhere around the city, and a headless motorcycle rider going around, freaking people out and stuff. While it does have somewhat "noisy" reputation in Real Life, its "Vice" aspects in both the books and their anime adaptation were heavily overplayed due to Rule of Cool.
Texhnolyze features Lux, possibly the bleakest example of this trope.
Tokyo in Tokyo Crazy Paradise, where robbery and murder in broad daylight is considered just a normal day.
Black Joke: Japan has been made the 51st state of the United States and prostitution has been banned in Tokyo. An artificial island, the Neon Island, has been built in Tokyo Bay for gambling and prostitution. It is a place swarming with organized crime.
Gotham City, mostly sinceBatman, now. Except the GCPD is full of honest, hard-working people (and Harvey Bullock), and organized crime isn't nearly so big as chaotic, supervillain crime.
Or at least it is now. Year One and The Long Halloween show that organized crime and police corruption were prevalent, and, after The Mafia was taken down, the "freaks" took over.
And its neighbor, Bludhaven, where Batman's former sidekick Nightwing set up shop in his solo book (later to be supplanted by the current Robin and Batgirl in their solo books). Of course, that was before it became a Doomed Hometown....
Hub City in The DCU, from The Question comics, was specifically written to be the most corrupt city in the U.S. Less than ten police officers were considered honest and the firefighters went out armed.
Maranatha, Florida in the titular unfinished web novel Maranatha and the on-going graphic novel series Heathen City, both by Alex Vance.
Madripoor in the Marvel Universe is a dystopian, crime-ridden and utterly corrupt version of Singapore. Like the Philippines!
Mega-City One from Two Thousand AD flagship title Judge Dredd certainly qualifies, and the Angeltown district from its Spin-OffThe Simping Detective is depicted as being worse than the city as a whole.
Cidade de Deus (City of God) as presented in the 2002 film of the same name — it is a part of the Favelas, and thus a case of Truth in Television. Notably, none of the scenes of the film were shot within the City of God itself, because the location was too dangerous to film in.
Rio de Janeiro as portrayed in The Elite Squad is this. Drug dealers rule the favelas, brutally murdering those who "offend" them. The normal police are corrupt and firmly in their pocket. Rich, ignorant students fund the drug dealers and misguidedly rail against the police. The closest thing to a beacon of light in this darkness is the fascist, torturing BOPE, who would be villains in a less cynical work. The sequel adds Lawman Gone Bad militia who violently feud with the dealers and the corrupt politicians aiding them.
''Chicago is a big, wicked city, and grown people could disappear in many ways, and who would there ever be to find to whom their little children belonged?'’
Pair-O-Dicenote ”Paradise” – yes, Ironic Name in Francine Rivers’ Redeeming Love is a shabby, makeshift town whose primary population appears to consist mainly of backwash miscreants delirious with Gold Fever, and prostitutes. Lots of prostitutes.
New Crobuzon from China Miéville's Perdido Street Station certainly is this. Even the government itself is involved in criminal activities that are hardly petty. There are thieves, spies, drug dealers, religious extremists and underground activists on every corner, as well as the god-damn most creepy prositutes in the history of literature, the people who are not involved in any sort of crime are likely to be the first ones to die or worse or alternatively perform things that are not illegal in New Crobuzon itself, but morally inexcusable to the modern western reader.
In Arrow, Starling City is ridiculously corrupt. The cops and judges are mostly on the pad, the administrators of the local mental hospital exploit their patients for profit, the leading candidate for mayor is secretly a costumed supervillain, and the city's wealthy elite are plotting to destroy the The City Narrows with an earthquake machine.
Mega-City One in the Judge Dredd pinball; the main purpose of the game is to visit various Crime Scenes and put away lawbreakers.
These occur on planetary scales in Warhammer 40,000. The entire Dark Eldar race lives in an extradimensional, planet-sized Vice City, for one, and these are people who quite literally survive by crossing the Moral Event Horizon every day, if not every hour.
In most Cyberpunk games, the background setting is one of these. Night City, in Cyberpunk 2025, is one prime example.
The Edge, capital city of Al Amarja, in Over the Edge. All the normal laws against drugs, violence, fraud, trademark infringement, and the like exist, but are only enforced if you piss off the government. In the event that you are arrested for something, bribing the local magistrate to let you off is not only legal, it's actually a major source of income for the state.
In the original BioShock 1, the underwater metropolis of Rapture was founded precisely to escape urban decay. Unfortunately, the discovery of a Psycho Serum on the sea floor created a drug market, which the Mayor refused to police. The drug eventually became the biggest economic force in the city, as every citizen was now hooked on it.
Its schoolyard counterpart Bully is this, BUT FOR THE WHOLE FAMILY!
Paragon City in City of Heroes is a far more idealistic version, with clear lines drawn between good and evil. The upshot of this is, even though there's just as much crime going on, you don't get to partake in any of it. You're a superhero, after all. The Rogue Isles in City of Villains are closer to this, though with their own twists. (For one thing, the "police" will attack you even though you technically work for them.)
Not so much 'work for' as 'are mercifully allowed to live and roam free in case you are the one destined to become strong enough to bring about The End of the World as We Know It'.
Antiva is a small country that so far has never been visited in the Dragon Age games, but gets mentioned a lot.
Zevran grew up in an Antivan brothel and some time after his mother had died he was bought by the local Assassins Guild to be trained, which he says was a lot better than being a street urchin once he survived the first years. He has a lot of stories to share about political assassinations and mentions a particularly funny one which ended in one of the assassins almost becoming king.
While being originally from the neighboring Rivain, Isabela had often been there as a pirate and a few stories of her own.
Isabela:"I had a husband. He didn't beat me, that's the best I can say about him."
Bethany:"So you left him?"
Isabela:"He was murdered. By my lover... It was all very... 'Antivan'."
The city of New Radius in Mark Ecko's Getting Up.
Arguably an inversion, as the conflict in the game is based around fighting a totalitarian (though admittedly still corrupt) local government and police force.
New York in the Spider-Man videogames — particularly Spider-Man 2 and Spider-Man 3.
Santa Destroy in No More Heroes definitely fits this trope, with street thugs in bondage gear armed to the teeth and out for the player's blood, to the point where pretty much no-one actually stays in the city willingly and desperately wants to take the first bus out of town.
In a bizarre example, the little town of Goldshire in World of Warcraft has become a Vice City of sorts, at least on RP servers. It's filled with strippers (13 year olds watching their naked female characters dance), prostitutes (13 year olds cybering), and criminals (13 year olds powergaming.) Goldshire is so well known for this that among the fanbase it is also known as Whoreshire.
It's also filled with a bunch of people who are desperately trying to ignore the aforementioned children. It's a pretty common gathering spot all-around, especially for big groups of friends, as it's obviously rather easy to reach.
Wild ARMs 3 has Little Twister, a Wild West town of outlaws. The various arena towns in the Wild Arms series may also apply, though they aren't really towns per se.
Zozo in Final Fantasy VI. Everybody's a thief and a liar, and unlike most towns, you'll hit random encounters while exploring.
Condemneddeconstructs this concept by showing how scary such a setting would be. All the crime ridden buildings in Metro City that the main character has to crawl through (and there are a lot of them) are filled with nothing but junkies and crazy homeless people.
True Crime: Streets of LA and New York City took this to a unique level by having the featured cities replicated, or at least with an accurate street and landmark layout. One review for the first game claimed that real life residents of LA could use any shortcuts they know in Real Life in game.
Omega, the unofficial capital of the lawless Terminus Systems in Mass Effect 2 fits in the trope quite well. More subtly all the basic elements of the trope also fit to Illium, an asari colony world where everything is legal as long as there is a contract for it, and criminal organizations and ruthless CEOs struggle for power behind the serene image presented for tourists.
Pyrite Town. Even for a Lighter and Softer work like Pokemon, Pyrite is a Vice City within a Wretched Hive - it's the only city with police officers in all of Orre, and despite them the hoods freely roam the streets! Let's not forget that this is a city Miror B. ruled over during his days as a Cipher Admin...
In All Points Bulletin, San Paro has some of the things mentioned, minus the prostitution, but it does have drug rings, assassins, and carjackings. As a side note, you have the choice of playing a criminal or a cop.
Midgar in Final Fantasy VII. The Wall Market is a sleazy red-lights district owned by Don Corneo, wealthy pervert and mafia crime boss, and muggers can be encountered as enemies in Sector 5, who may steal your items and run away from them, taking them forever if you fail to beat them in time. Corel also suffers from having thief enemies.
Many cities become this under weak or nonexistent central authority. Over two-thirds of the world's heroin came through Kabul after the Taliban rolled in. Iraqi cities are the leading suppliers of child prostitutes in the world.
Israel during the reign of Jeroboam II. The prophet Amos blasted it for its corruption, its decadence and its lack of concern for the poor.
Heroica Ciudad Juárez in Mexico is practically overrun by drug cartels, street gangs, serial killers, rapists and so on. Experiencing an average of eight homicides a day, Juárez has been nicknamed "Murder City" ("Ciudad Asesino"). Some, like Charles Bowden, even allege the police and army are really fighting the cartels—and each other—for control of the drug industry, not to restore order.
Averted by El Paso, Texas right across the border, which is considered one of the safest cities in the United States.
Las Vegas during the 1950s came pretty close. The official crime rate was twice the national average in almost every category, and the amount of unreported crime was apparently greater.
It's slowly gaining back the reputation in modern times, due to murder and shooting levels on the rise. Even worse, some journalists recently referred the city as Chiraq. Most of it is still very nice, but the rougher areas are really rough, and god help you if you accidentally find yourself in Englewood.