Almost all of Vatican City's little more than 800 citizens either live inside the Vatican's walls or serve in the Holy See's diplomatic corps in embassies (called "nunciatures"; a papal ambassador is a "nuncio") around the world.
Vatican City State is a landlocked sovereign city-state whose territory consists of a walled enclave within the city of Rome, the capital city of Italy.
Vatican City is a city state that came into existence in 1929. It is therefore to be clearly distinguished from the Holy See, which already was in existence for many centuries before that date.