To know the city where the Christmas story was based, we need more specific information about the particular story. It could be anywhere from a real-life urban center to a made-up place in the author's imagination.
The Christmas story could be based in various cities depending on the specific story. Without more context, it's hard to give a definite answer.
It's not possible to determine the exact city where the Christmas story was based without additional details. Different Christmas stories might be set in different locations, such as New York, London, or a fictional town.