Kirkwall in Dragon Age II used to be the new heart of the slave trade for the Tevinter Imperium 600 years ago, but since so many slaves died in those walls, the boundaries between The Fade and The Real World weakened greatly, allowing easy possession of not just mages from demons, but regular people. There's constant crime on the streets at night from dwarf carta members, mercenaries, slavers, imposter city guardsmen, and blood mages. The Templars and mages are far more insane and extreme than they were in the first game, and their conflict ends up forming the game's main crisis. Finally, this cesspool is under the watch of an Authority in Name Only.
Everywhere in the Rogue Isles is the titular City of Villains. The Isles are actually run by scum and villainy.
Paragon City, the titular City of Heroes, has seen better days itself. Most of the world's superheroes died during the Rikti War, to say nothing of the havoc it wrought upon the world at large. Street gangs, emboldened by a severely weakened police department and hero population, brazenly harass and threaten citizens with their lives.
Fable II has the town of Bloodstone, a sort of Evil Counterpart to the town of Bowerstone: while Evil characters are treated with fear and suspicion in Bowerstone, in Bloodstone they are treated with respect.
In Fallout, Junktown will become one if you help Gizmo and the Skulz gang take control. The Hub will also be on its way of becoming one if you side with Decker.
In Fallout 2 there is The Den (which is even referred to as such): an anarchistic community populated by drug addicts and slavers, and New Reno: a city dedicated to prostitution, pornography, gambling and bloodsports, run by a variety of constantly-feuding gangs, with no authority whatsoever in appearance. Redding may also become one if you have them ally themselves with New Reno.
In Fallout 3 there is Paradise Falls, a town run by slavers. Characters can even improve their karma by murdering everyone in town except the slaves.
In Fallout: New Vegas, there is Nipton, which by the time the Player gets to it, is already razed by a more (albeit affable) evil entity, Vulpes Inculta, after he duped the town into capturing and killing some visiting NCR troopers on leave. Freeside can also count, although nowhere near the degree of Nipton. Poverty is essentially omnipresent, most of the population is homeless, and those that aren't live in absurdly poor living conditions, and despite the efforts of the Kings and the Followers, crime is rampant to the point where drunks, addicts and general thugs assault people in the streets in broad daylight. However, there are still some redeemably good people there, unlike Nipton.
Zozo in Final Fantasy VI is more of a dungeon than a city, since you run into random encounters in its streets and it has an end-boss. Every single person living in the town is a filthy liar. The boss of the area says something to the effect of "I hate fighting, so I'll just let you pass peacefully", then attacks you.
All of America could easily apply, given all we hear about it.
Kras City, in Jak X. The only genuinely good people you meet apart from Rayn even though that's an act seem to come from Haven, Spargus, or the distant past. The Jak games (since they went Darker and Edgier) are dedicated to the idea of "a few good people in a Crapsack World", so it's not too surprising.
The Dreshdae spaceport on Korriban in the first game is a lot smaller, but still pretty wretched: everyone there is either an aspiring Sith out to prove their evilness, an actual Sith relaxing by kicking puppies, or a smuggler looking for somewhere to dump weapons they can't offload in civilized systems. The whole place is run by the slave-trading Czerka Corp, and the bartender is an arms dealer.
The concept of Outer Heaven reappears in a new incarnation in every other game of the Metal Gear Solid series: Outer Heaven (MG), Zanzibar Land (MG2), Liquids plan for Shadow Moses Island (MGS), Arsenal Gear (MGS2), and both Outer Heaven (company) and Outer Haven (submarine) (MGS4).
Rogueport in Paper Mario: The Thousand-Year Door is a parody of this trope. The fact that this sleazeball town also features a shop that enlists people to help the other residents, most often with actual legitimate things as well, makes it all the more enjoyable.
Empire City from inFAMOUS begins this way, but taking the good path can lead to the city cleaning itself up and return ing to the state of a bustling metropolis it once was. If you take the evil path, however, things take a turn for the worse, and soon not just the city, but indeed, the entire world, is in fact a Crapsack World.
The space station Omega in Mass Effect 2, which serves as the capital of the Terminus Systems, the lawless backwater of the galaxy where might makes right and slavery, among other things, is a vital part of the economy. However, the game makes a point of showing that many perfectly ordinary and decent people do live on Omega — they're just poor, desperate, or have nowhere else to go.
Miranda:"Omega. What a a pisshole."
And, as an amusing inversion, there's Illium — it's a Wretched Hive, where drugs, slavery, arms-dealing and prostitution are omnipresent — but it's run by the artistic, diplomatic, ultra-civilized asari. Which means that it's all set against a backdrop of awe-inspiringCrystal Spires and Togas architecture, with a thin veneer of legality covering everything. Even the most brutally mind-scarring drugs are legal... as long as there's a truthful description of the effects on the package and a legal waiver. And it's not slavery, it's indentured servitude. Also Eclipse mercenaries have their hands in all kinds of illegal and legal operation there and their joining ritual is to kill someone. Garrus comments on it directly if you bring him there... "Look just a bit deeper, and this place is no safer than Omega." It's PlanetNoble Demon; Upon arrival, guests are immediately greeted by armed guards and warned to not sign anything — "We're a whole planet of greedy bastards. If you don't like it, stay away. Otherwise, come on down and bring lots of money."
Ironically, the one stable leader in Omega, who is the closest thing they have to a ruler, concerned with keeping Omega running, is an openly ruthless asari too. Which can be also said about Omega itself. At least it's honest about being a wretched hive.
Interestingly, it is possible to help clean up Omega a little bit, at least by implication, in the Omega DLC for Mass Effect 3. If Shepard plays full Paragon, it gradually begins to get to Aria that she doesn't have to be as ruthless and violent as she is. Then when Nyreen dies to save Omega citizens, Aria takes that act to heart, and will even go so far as to spare Petrovsky's life at the end, and focus on rebuilding Omega and protecting its citizens. On the other hand, a fully Renegade Shepard will instead leave Aria filled with ruthless violence, and she'll choke Petrovsky to death with her bare hands and keep Omega in its brutal, lawless state.
There's also Noveria from the first game. A planet settled almost entirely by corrupt corporate executives and mad scientists. Absolutely everybody on that icy rock is trying to bribe/manipulate/kill you in some manner. And the orbital defenses? They're not pointed spaceward, but planetward. Just in case one of the mad scientists' experiments get out of hand.
Clint City from Urban Rivals. There's a police force, but they're even in terms of power and influence with the mob, the surf bums, and the denizens of the city zoo.
Thieves' Landing in Red Dead Redemption is Exactly What It Says on the Tin: A little gambling town in the bayou where you can't go a few seconds without a crime happening and the mini-game order of the day is either five-fingered fillet or poker with a couple of cheats.
Jubei from BlazBlue directly quotes this trope in Ragna's story mode.
Even though it lost much of its power in the backstory, the Tevinter Imperium in the world of Dragon Age definitely counts. The country is practically one giant empire where Blood Magic (read: magic specifically designed to control and murder people in the most horrific ways possible) is practically required by law, slavery is legal and exceedingly brutal, and those who are not mages are treated little better then the slaves. The sequel ups the ante by having one of Hawke's companions, Fenris, be a former slave to the Imperium, and he makes it perfectly clear just how horrible the place is.
And, if some of Fenris' dialogue is true, then the Imperium may be well on its way to reclaiming the power it lost to Andraste's rebellion and the fall of the Golden City. Oh Crap.
The city of Tortage in Age of Conan fits this trope. The city is a haven for pirates, prostitutes, slavers, smugglers, and other less than savory people.
Hector: Badge of Carnage has Clapper's Wreake, a complete shitstain of a city, with the main antagonist being a terrorist whose finally had enough of the corruption and decides to do something about it.
Markarth and Riften in Skyrim are both run by powerful and corrupt families. The Silver-Bloods run Markarth in all but name, while the Black-Briars run Riften. In Riften the corruption is so rampant that the near extinction of the Thieves' Guild based there has done nothing to reduce it. It's even worse in Markarth, since one of the Silver-Bloods is using the captured leader of the Forsworn to murder anyone he doesn't like (and disguising the assassinations as terrorist acts). And he doesn't have nearly as much control over the Forsworn leader as he believes.
Markath at least can be made a better place by killing everyone involved in the criminal activities. Granted, that's pretty much everyone in Markath.
Dunwall in Dishonored is slowly but surely falling apart at the seams. The Plague has wiped out great swaths of the population, whole districts of the city have had to be sealed off as a result of it (and some have even flooded out), the upper classes are completely indifferent and content to continue their decadent lifestyles, the city watch is little more than a band of well-armed and state-sponsored thugs, and the ruling regime which came to power by usurping it from the Empress is deeply corrupt and oppressive (and they're the ones who unleashed the Rat Plague as an attempt to Kill the Poor in the first place). Depending on how much Chaos you accrue over the course of the game, Dunwall either eventually manages to get better, or descends into all-out anarchy.
The Mushroom Kingdom from Vector Thrust is rapidly turning out to be one- a collection of once-proud nations that fell victim to infighting and eventually nuclear attack. After several years of neglect by the rest of the world, the nations that still stand continue to war with each other over food and medication for their slowly dying population.