Traverse Town is similar to a Victorian-age town in terms of design and layout. It is divided into three major districts along with several minor locations such as alleyways and caves. Besides being created from fragments of destroyed worlds and serving as a home to those who's worlds have been destroyed by the Heartless, Traverse Town is also a great place to shop.
First District
The First District is the most peaceful of the three, without the presence of Heartless (with the exception of the first episode, where Heartless can even be found here after Sora searches for Riku and Kairi). The First District is where most survivors of the destroyed worlds can be found. The most notable locations include the Accessory shop owned and managed by Cid, the Item shop run by Huey, Dewey, and Louie, and a Synthesis Workshop run by Moogles on the top floor of Cid's store, and there is a shop that run by Cid after you locked the keyhole at Traverse Town that sell Gummi Blocks near the gate to Second District. There is a restaurant with magical self-lighting candles to the left of the town entrance, and Geppetto and Pinocchio, along with their goldfish, Cleo, move into a green-doored house nearby after the Monstro world is completed. The mailbox used in the Postcard hunt is also found here, close to the door leading into the Third District. Directly across from the accessory shop is a large set of double-doors which serve as the entrance to the town and can return the player to the world map to choose another world to travel to.
Second District
The Second District is infested with a variety of Heartless. Notable locations include the Gizmo Shop (a bell on the roof can eventually be rung three times in order to reveal the world's Keyhole), and the Dalmatian's House, where Pongo and Perdita have settled due to the destruction of their world. The Hotel is on the west side of the district and is often invaded by Heartless, but can be entered through the Lobby; in addition, the Red Room and Green Room are located within the Hotel, where Sora, Donald, and Goofy are briefed by Leon and Aerith. The east side of town includes the entrance to the Third District, as well as a set of roofs that can be climbed to reach treasures and a hidden entrance to a balcony in the Third District.
Gizmo Shop
The Keyhole for Traverse Town was hidden, but revealed only after the bell atop the Gizmo Shop tolled thrice (the bell can be accessed by climbing a ladder at the Gizmo Shop's exit, then by activating a Red Trinity mark to break down the barrier). The Keyhole is located in a fountain near the First District entrance. When the player approaches the Keyhole he/she will have to fight Guard Armor and Opposite Armor before sealing it off. Inside the Shop there is a Trinity Mark. This can be accessed by using Thunder on the broken wires in the Third District. There are raised platforms in the Shop; the player should jump up on each to gain access to the Trinity Mark and some chests. After activating the Trinity Mark, the player should then examine the clock inside the Gizmo Shop; it is stuck at 6:54. The player will then gain two postcards.
Third District
The Third District is a plaza also overrun with Heartless, but is the smallest of the three main districts. Notable areas include the Vacant House next to the Second District's door, which Leon and his crew eventually claim as the Small House, their headquarters. The most notable feature in this district is the golden fountain in the corner of the lower area, which depicts an image from Disney's 1955 film, Lady and the Tramp. In another corner, a short alley leads to a door with a flame on it that goes to the Mystical House, and in turn the Magician's Study (also referred to as the Zero District by Merlin in Kingdom Hearts II) , where Merlin and the Fairy Godmother take up residence. The book that serves as the entrance to the 100 Acre Wood can also be found in the study. Casting Thunder on the exposed cable wire raises the platforms in the Second District Gizmo Shop. Finally, a keyhole next to the giant door to First District can also be found and unlocked for faster access to that area.
Other Areas
The Back Alley (or the Alleyway) is accessible through the Second District; by leaping over the crates at one end to go back to the First District, through the Dalmatians' house, and from the balconies of the hotel. Going through the drainage grate opposite the crates allows Sora to enter the Secret Waterway, which serves as Leon's secret training ground, as well as a back entrance to the Magician's Study.