I am writing an adventure where an elven village and a human village are slowly merging into one town, and are invaded by kobolds. But leave the kobolds out of it for now. Here, you have two wildly different populations growing into each other.
The Elven Town of Aquarin has built a forest in a desert valley using magic and science. Man has tamed the wild valley to make it bring forth fruit. But to the south is Aquarin, built on a gently rising slope. To the north is Hunter Village. The two populations have been growing together, and the elves of Aquarin have realized that they couldn't stop it, so they gave a Kobold King's ransom to Hunter Village, and the resulting money has caused the village to literally explode.
The setting is a creatively Anachronistic Salt Lake Valley, to lead into my Amazons of the Desert ideas. :) This is the not the first time a writer uses a real world location as creative license. May I remind you of Xanth?