This paper is focused on virtual campuses, i.e. virtual worlds representing real educational institutions that are based on the metaphor of a university and provide users with different learning tools. More specifically, the idea of integrating a virtual campus into the context of a virtual city is suggested. Such a virtual city, where students live and work, can extend the possibilities of a virtual campus in supporting learning and socializing. This paper provides a description and analysis of an empirical case study that was performed to test and develop these ideas. Based on the results of the study, a set of guidelines for designing a virtual campus in a city context is presented. (Contains 15 figures.)