According to John L. Smith in No Limit: The Rise and Fall of Bob Stupak and Las Vegas’ Stratosphere Tower, in the ‘50s and ‘60s when showgirls were all the rage in Las Vegas, many of them lived in the apartments in the small subdivision that radiates for eight or 10 blocks from the northwest corner of the Strip and Sahara Avenue behind what’s now the Stratosphere. Because they wore skimpy costumes on stage and needed their tans to be uniform, they sunbathed topless (and sometimes bottomless) at the pools in the apartments. In other words, naked in the city.
In subsequent decades, Naked City became a neighborhood occupied by southern Nevada's growing immigrant population, which included an element of hardened criminals, notably Cuban drug dealers. The current ramshackle condition of the old apartments and the prevalence of ladies of the night mean that the name has taken on different connotations today.
On a side note, an evocative scene takes place in the Naked City area of the ‘50s in the recent novel The Lucky by Lee Barnes. The Lucky, a gripping fictional look at the Binions, is one of the greatest novels ever written about Las Vegas.
