Zendar is the starting city. Unlike most towns it has a large and unique design (although this is changing, as other towns get expanded) and is neutral. It is also home to the Arena, where combatants can try their luck and win fame and fortune.
Unlike all other towns you leave when you hit <tab> rather than getting a destination menu (which allows you to jump directly to the merchant/castle/etc.) and you also can't ride your horse in town.
Trainer
The trainer offers free fighting tips and practise. Every time you level up in training you'll get 100 exp or so, so it's good to run through this for some free exp even if you already know how to play.
Constable Hareck
The constable will reward you for hunting down river pirates in the area around Zendar. If you accept he will give you a basic shield to help on your mission.
Arena
A good way to both make money and also gain experience. See Arena for more.
The Happy Boar (Tavern)
The arena fighters loiter here and talk about their victories. You can also find the penniless merchant Marnid here. He'll join you if you bring him a Padded Cloth. He'll take any condition but he won't accept any other armor type, even better ones.
Town Square
As per usual there's an armorer and a weapons shop.
Merchant
The Zendar merchant sells cheap Tools and will pay good money for Salt from the Salt Mine. Template:GFDL Article