A city constructed by the Lilim and visualized by Ibriel, though neither lived within its walls, it became the dwelling place for the angelic Host. It was originally created by Jerry Siegel and Bernard Baily in More Fun Comics #52, (February 1940). It exists "outside the created order of things" and predates the rest of Creation.
It was reintroduced in the Season of Mists story arc, when the angels, Duma and Remiel, were dispatched to the Dreaming to observe the events there following Lucifer's abdication of the throne of Hell and handed the key to Dream.
Gaiman used the location again in his short story "Murder Mysteries", which is set in the Silver City, and features the angel Raguel's investigation of the first murder ever.
In 1999, in Mike Carey's Sandman spin-off series Lucifer, the Silver City is a frequently seen location.