The city of Myagmarsuren was once a grand city. It was the far east outpost of the great Syiin empire from the late second age. When the world was destroyed, the mountains served to protect this city much more than others. So, in the early third age, this city was viewed by many as the bastion of civilization. Refugees flocked here from all corners of the world, making it the premiere center of magical study anywhere!
Sadly, this concentration of power was also its downfall. In III:364, a power stuggle between the now clanish wizards broke into open warfare. Much of the city was destroyed and most of its people killed or fled. Once the fighting subsided around III:385, the city began to recover and by the early 5th century, it was once again a thriving place. However, the wizards had moved on and the great magics went with them.
Then, in the year 568, the sorceress Qojin Beki returned to reclaim the city for her own. She began enslaving the city leaders with her magic, but ended up triggering a long-dormant “dead man” spell left behind in the 4th century war. The result was an infusion of evil that instantly killed Qojin Beki. However, she had her own “dead man” spell, which unleashed a torrent of evil that within a day killed the city's entire population and transformed the lake fauna into monsters.
Because the killing was so complete, very little of this story survives.
The city of Myagmarsuren is a literal ghost town, populated entirely by undead. During the day, it is mostly quiet as the more advanced undead will have retreated to their underground safety. However, during the day the skeleton and zombie soldiers that comprise the majority of the city's “population” will eventually stir and attack any intruders.
At night, though, it is another matter! The teeming sewers release a flood of ghouls, ghosts, and other nasties. Any person foolish or unlucky enough to travel into the city at night, is likely to die a horrible death – and spend eternity haunting the city along with its current denizens.
The city itself is enchanted with a heady dose of negative energy. This manifests itself as a permanent Protection from Good spell that covers all the area inside the walls, plus about 100 feet outside. Also, there is a foul stench in the more confined areas - especially in any buildings that still stand. The smell has no combat effect, though.
The “society” in Myagmarsuren is - to say the least - unusual. Because the city is so isolated and feared, almost no living creatures go there. As a result, the undead have no supply of fresh life to feed on. They are forced to forage outside of town to capture animals and anyone foolish enough to wander nearby. However, because they cannot travel during the day and are reluctant to travel outside the Protection from Good region, their range is severely limited. This leaves them with little to do but fight amongst themselves - which they do constantly!
This fighting, though, damages their bodies - and most of the undead suffer over time because of this damage: Skeletons become immobile, Zombies rot away and become Skeletons, Ghouls wither and become Zombies, etc. For every undead in the city, it may be assumed that there are perhaps two or three non-functional Skeletons nearby. This, along with the pervasive evil in the area, has the effect of reducing a cleric's turning damage by 4HD on each attempt.
To protect themselves from each other, the undead have formed crude gangs.