Claim: Mexico City is set in the Valley of Mexico.

Mexico City , or the City of Mexico -LRB- Ciudad de México , -LSB- sjuˈða ðe ˈmexiko -RSB- ; abbreviated as `` CDMX '' -RRB- , is the capital and most populous city of Mexico . As an `` alpha '' global city , Mexico City is one of the most important financial centers in the Americas . It is located in the Valley of Mexico -LRB- Valle de México -RRB- , a large valley in the high plateaus at the center of Mexico , at an altitude of 2240 m . The city consists of sixteen municipalities -LRB- previously called boroughs -RRB- .   The 2009 estimated population for the city proper was approximately 8.84 million people , with a land area of 1485 km2 . According to the most recent definition agreed upon by the federal and state governments , the Greater Mexico City population is 21.2 million people , making it the second-largest metropolitan area of the western hemisphere , behind New York City , the tenth-largest agglomeration , and the largest Spanish-speaking city in the world .   The Greater Mexico City has a gross domestic product -LRB- GDP -RRB- of US$ 411 billion in 2011 , making Mexico City urban agglomeration one of the economically largest metropolitan areas in the world . The city was responsible for generating 15.8 % of Mexico 's Gross Domestic Product and the metropolitan area accounted for about 22 % of total national GDP . As a stand-alone country , in 2013 , Mexico City would be the fifth-largest economy in Latin America -- five times as large as Costa Rica 's and about the same size as Peru 's .   Mexico 's capital is both the oldest capital city in the Americas and one of two founded by Amerindians -LRB- Native Americans -RRB- , the other being Quito . The city was originally built on an island of Lake Texcoco by the Aztecs in 1325 as Tenochtitlan , which was almost completely destroyed in the 1521 siege of Tenochtitlan , and subsequently redesigned and rebuilt in accordance with the Spanish urban standards . In 1524 , the municipality of Mexico City was established , known as México Tenochtitlán , and as of 1585 it was officially known as Ciudad de México -LRB- Mexico City -RRB- . Mexico City served as the political , administrative and financial center of a major part of the Spanish colonial empire . After independence from Spain was achieved , the federal district was created in 1824 .   After years of demanding greater political autonomy , residents were given the right to directly elect a Head of Government and the representatives of the unicameral Legislative Assembly by popular vote in 1997 . Ever since , the left-wing Party of the Democratic Revolution -LRB- PRD -RRB- has controlled both of them . In recent years , the local government has passed a wave of liberal policies , such as abortion on request , a limited form of euthanasia , no-fault divorce , and same-sex marriage . On January 29 , 2016 , it ceased to be called the Federal District -LRB- Spanish : Distrito Federal or D.F. -RRB- and is now in transition to become the country 's 32nd federal entity , giving it a level of autonomy comparable to that of a state . Because of a clause in the Mexican Constitution , however , as the seat of the powers of the federation , it can never become a state , lest the capital of the country be relocated elsewhere .