When Steven Taylor crashed on the planet, the Mechanoids captured him and held him prisoner in the city. Two years later, the First Doctor and his companions arrived on Mechanus and were also taken to the city, where they met Steven. The pursuing Daleks entered the city and attacked the Mechanoids.
The Doctor and his friends escaped the Mechanoid City just before it, the Daleks and the Mechanoids were all destroyed. (TV: The Chase) The Mechanoid City was destroyed when the Daleks, led by a Black Dalek, used a atom divider to destroy its leg and the resulting explosion toppled the city and handed the Daleks victory against the Mechanoids. (COMIC: The World That Waits)