Vatican City is the only capital city that is a sovereign state entirely surrounded by a single city: Rome.
Vatican City is a sovereign city-state and an enclave within Rome, Italy. Its territory covers roughly 0.49 square kilometres and is largely enclosed by the Leonine Walls. Because the surrounding urban area is Rome itself, the country is unusual even among the world’s microstates and enclaves.
The modern state was established by the Lateran Treaty, signed on 11 February 1929, which settled the long-running dispute between the Kingdom of Italy and the Holy See. Vatican City is the territorial state; the Holy See is the institution that represents the Catholic Church in international law and diplomacy.
San Marino and Monaco are frequent alternatives, but neither fits the wording. San Marino is surrounded by Italy as a country, while Monaco borders France and the Mediterranean Sea. Even St. Peter’s Square illustrates the unusual border: part of its boundary with Italy is marked only by a white line.