The easiest pitfall, it seems, is to give too much of a good thing. The devil is in the details because rich and inspiring descriptions are important, but they have to be handled carefully. On one hand, you have to remind yourself that you are creating a location for a roleplaying game, not a novel. Reading paragraphs full of descriptive text might work for some groups, but showering players with information that doesn't affect actual gameplay is likely to turn many people off. I once knew a guy who wanted to create his own fantasy world, and he regularly fixated on details that the players were unlikely to care about or encounter. He chased people around, asking what they thought of his map or his ideas for plate tectonics. As a native of the Los Angeles area, I can tell you: people aren't going to care much until the ground starts moving.

The details you choose to share with your group need to be portioned into bearable chunks that invoke images in player's heads. This is a way to keep player attention and garner player curiosity. Maybe the introduction to a neighborhood will highlight the sense of crowding and cramped quarters, with narrow buildings lined right up to the sidewalk, looming over cars as they pass. Perhaps the woman on the front steps gives the PCs a suspicious glare before going inside, and people look around cautiously while walking down the streets. The bars on the windows are only one sign that the inhabitants are paranoid, but going into further detail will only belabor the point.

The details you focus on need to give more than flavor; they also have to matter in some way. In the neighborhood above, the details deliver the theme and mood of the place and hint at the way the PCs will be received. Outsiders encounter a lot of distrust when asking questions, but neighbors aren't given much more quarter. Researching a disappearance might be hard, but by using databases, the PCs might find that an inordinate number of people from that neighborhood are committed to mental health facilities. Those inmates might be more helpful. Or, if the PCs decide to rent a room in the area, they might start to feel as though they're being watched everywhere they go after a few nights of sleeping there.

And in everything that you do, you must remember to leave room for the player characters to exist, influence, and interact. A setting that has all of the characters it needs might make players feel shut out. Likewise, non player characters can become so tightly intertwined that there's no room for the player characters to insert themselves. And a place in which all land and resources are owned and rigidly controled can take away the feeling that there's something to reach for. So consider the deficiencies and empty rungs on the ladder of your setting.

Characters attitudes/reactions

Consistency

I can't speak for designing cities for fiction, but I can tell you how I've done things for games. I had a similar experience to Dr. Who's time and place hopping when I ran Stargate; just about every game was on a world the PCs had never seen. Sometimes coming up with a theme or predominant idea for a city can be a helpful way to start brainstorming. If it's located on a Rift, how does that affect things? What makes the city stand out from others? There are lists of attitudes that PCs can have, and you can assign some of those to a city's overall demeanor (particularly toward outsiders), as well.

Sometimes, if I'm really in an associative mood, I'll think of ways to associate places with things around me and then flesh the city out from there. Like, a city as a vitamin bottle (which is sitting on my computer desk) - it's the place where valuable minerals are mined, and will withhold shipments of needed nutrients if it's not given 'proper' tribute. The people there are bigger, stronger, and healthier than the rest of the nearby areas, and aggressively protect their interests. They ease their consciences by taking in outsiders to work in the mines, and they're given proper nutrition and places to stay (even as they are worked to death). A faction in the city disagrees and is involved in smuggling needed supplies to outlying settlements, but it has to move carefully.

Then, when considering a city, think of a major situation that's going on there (like the vitamin mines) and then a few minor situations (smuggling, attempts to weed out the smugglers, a diplomat from a nearby village who needs help convincing the council to reduce the demanded tribute). These situations should be things that the PCs can access, and maybe a few that are more off to the side. From there, you'll know which NPCs will be needed first. You can also try coming up with three things about the city that work and strengthen it, as well as three things that don't work and make things difficult.

You should also consider the nearby terrain, and how it influences the city. Some places don't seem to react to geography as much as others. But for the city near a volcano, or on an active fault line, or sitting on the edge of a waterfall, the natural features affect many things within the settlement.

You can get a hold of a published setting-building resource to give you ideas. This little PDF has ideas for building a (namely fantasy or medieval) city by districts. Cityscape expands on those ideas. Damnation City by White Wolf games does the same sort of thing for modern settings.