City lights are used in Europe as additonal parking lights. It's a low watt bulb that fits inside the high beam housing.
note: This can be used to get rid of the Check Low Beam lights message if you have upgraded to HID's from H7 bulbs.
There is a small section of the head lamps where the city lights will fit, it's located on top of the high beam housing of the head lamps. Some drilling is required for North American cars. It is similar to DRL (Daytime Running Lights) for older E39 models that does not have the option.
Since the City lights is tied to the parking lights or the low beam lights depending on your install, it can be turned on or off at will.
The City Lights are the lights next to the head lights closer to the grill.
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