Dwarves live underground. That means the dot on the map may not be accessible when travelling on the surface. This may be obvious to you (the DM), but can come as a surprise when the players finally get to your fantasy dwarven city and find it missing. Make sure you establish some of the basic world assumptions before your PCs get to that point. It’s likely that even a underground town has some kind of connection to the surface. It may be hidden, used only in emergencies or only used by the ruling class. I often will use a small, well-defended trade post above that, like an iceberg, only represents part of the sprawling metropolis below.
Dwarves are often associated with brewing and mining. You should establish how your dwarves get what they need to do their job. This helps create links to your other cities. Miners can likely get all they need from a mineral rich location. Beer requires ingredients however, usually farmed ones. Do they farm the fields above their city, or rely on subterranean roots? Maybe they depend on human traders for their materials but make it back in the ale they export. If the site doesn’t supply what dwarves in your world typically cherish, that’s great. That makes these dwarves interesting. Now you need to determine why these dwarves are here.
Culture doesn’t always have to be linked to race. A town of mages or devout have that same kind of cultural impact. A town of mages was likely built up around an academy, or the tower or a well-known and generous wizard. Just like a college town now, a town filled with arcanists is probably centered, mentally if not physically, on this location. Taverns may be named after spells or components, and serve drinks of strange colors and flavors. Shops favor robes over commons clothing and it may prove difficult to buy a new executioner’s axe or set of plate mail.
A town of devout may have many of the same college town qualities of the town of mages, with things centered around a single temple, monastery or holy site. There are many other reasons that a town might be devout, though. Perhaps the town historically has been the site of several wars and their devotion to the war god is part of that culture, or seen as a means to survival. A bad drought could cause severe devotion to the god of rain or agriculture. A particularly powerful divine NPC may have also been through town, having saved it, or threatened it.
Practicing faith in a god generally comes with its own laws, traditions and celebrations. Depending on how the town came to this faith, they may follow it to the letter, or if they are without official guidance of a cleric or priest, they may be making their own judgements on how they should act.
The other big influence on a town’s residents is national culture. A town that is or was part of a larger country likely has a lot of influence from that nation. This can be a particularly hard concept to make up from scratch. However a popular choice is to base these cultures on historic societies. There’s no shame in having a nation based on the ancient Egyptians, Renaissance Italians or any other real-world culture. In fact, it gives you some real advantages. These cultures are likely already familiar to your players, so you can more easily paint a vivid image in their heads with less description. A lot of fantasy gaming already comes from the myths and history of earlier civilizations, so there are natural ties to the content your already using in your game.
Fair warning, you may feel compelled to try to out-learn your players when using this tool. The fear that your players will know more about ancient Egyptians than you and use that knowledge to a greater advantage in play should not be something to worry about. Remember, these dwarves are only loosely based on the Egyptians. Should a player want to use real-world knowledge, that you haven’t established as fact in your game, encourage them to confer with you first. Say yes whenever you can, but if you had plans for something to be different then it’s different. It’s the differences that are often the most interesting.