Like Halloween Town, Christmas Town is loosely focused on Christmas, and is located through a door in the Hinterlands. As a special world, it represents the holiday of Christmas. Once a year, the ruler Santa Claus will travel throughout the universe to give presents to children named on his nice-list.
In Kingdom Hearts II, the Hinterlands will take characters to Yuletide Hill, which they can travel down the Candy Cane Lane to reach Christmas Town. In Christmas Town, characters can visit with Santa Claus himself in Santa's House and explore the Shipping & Receiving and Wrapping Rooms of the Toy Factory. Later in the game, characters can also go by Christmas Tree Plaza to fight a boss battle.
When Sora, Donald and Goofy arrive in this world during Kingdom Hearts II Final Mix, their disguises have changed to fit the Christmas theme. However, Jack never comments on their change of wardrobe.