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Christmas was a town on the level-2 human colony known as Trenzalore, described by Tasha Lem as a farming community. It contained a residual crack in time left behind after the Eleventh Doctor rebooted the universe.
The town became the focus of universal attention due to a signal emanating from a crack in time in the Clock Tower. This signal also contained a Truth Field that encompassed Christmas, which was of Time Lord origin, and asked the Question "Doctor Who?". The answer of the Doctor's real name would be proof to the Time Lords that they had found the right place to return to the universe. This led to the Siege of Trenzalore. The Eleventh Doctor sent Clara Oswald away in the TARDIS, but before the TARDIS could return to the Doctor, Clara held on to the side of the TARDIS, with the TARDIS protecting her from the Time Vortex. This caused the TARDIS to arrive with Clara in Christmas three hundred years late.
For the next three hundred years the Doctor, alongside the village's inhabitants and the Papal Mainframe's soldiers, defended the town from various aliens including Sontarans, Daleks, Weeping Angels and Cybermen. Eventually all but the Daleks retreated or were destroyed.
Eventually the Doctor's TARDIS returned, allowing Clara to answer the question, stating that "the Doctor" was the only name that mattered. Although they did not return, the Time Lords did grant the Doctor a new regeneration cycle when his last incarnation was dying before closing the crack. Using his regeneration energy, the Doctor obliterated the Daleks besieging the town, at the same time causing a shockwave that damaged the town but left it intact. With the threat gone, the Doctor and Clara returned to his TARDIS and left the town. (TV: The Time of the Doctor)
Daylight lasted only a few minutes in Christmas, during which the Doctor would often stand on the Clock Tower's balcony and look out over the town, reminding himself of what he was protecting. The town was lit by 20th century-styled street lamps during the long nights.
Behind the scenes
The Christmas town's filming location was an old army training place. The buildings there didn't have windows, so the houses' windows had to be faked.