There are two reasons why that may have been a sin. One is that a disaster could wipe out the whole human race and another is that one of the first laws given to us by G-d was to fill up the earth and conquer every part of it. Ralbag explains that the reason G-d wishes for the world to be spread out is that this way the human race is guaranteed survival. Should natural disaster occur in one place, the other area would be spared. Rav Meidan of Israel says that the sin was in trying to live in the city as opposed to the country.
Cities are often places of evil and dehumanization.
The tower was a plan to citify everyone.