What counts as a college town? Depends on who you ask.

For some, the presence of a large public university is a non-negotiable. For others, having a large enough non-student population is an immediate disqualifier. Some towns might not have as strong a connection to their central university as others, and some might have broader historical reasons for attracting residents.

Definitions vary, but under nearly all of them, Ann Arbor, Michigan, is close to what it means to be a textbook case of a college town.

A recent WalletHub study ranked Ann Arbor the second-best college town in the US, behind Austin.

The Midwestern city has about 122,000 residents, while the University of Michigan enrolled 53,488 students at its Ann Arbor campus in fall 2025 — equivalent to roughly 44% of the city's population.

The University of Michigan is an economic engine — and a large part of the city's identity

The University of Michigan is Washtenaw County's largest employer, with roughly 37,400 workers across the university and health system.

In fiscal year 2025, it purchased more than $296 million in goods and services from county businesses, and university property now accounts for about 10% of Ann Arbor's land.

The university also gives the relatively small city a research and startup ecosystem more akin to those of larger economic hubs.

In 2025, the university reported spending $2.16 billion in research across its three campuses. In fiscal year 2026, the university launched a record 40 startups, while university-backed startups raised a record $796 million in venture capital.

But while opportunities are plentiful for students and recent grads, Ann Arbor isn't uniformly cheap.

Average rent surpassed $2,000 in late August, according to Zillow, while 2024 federal data showed housing rents in the metro area were about 25% higher than the national price level.

College football and local culture unite the city's community

Few things illustrate the university's influence on Ann Arbor more than football.

Michigan Stadium on the university's campus seats 107,601 people — nearly as many as the entire city's population. Ask any Michigan fan about their gameday memories, and you'll immediately see why.

Music venues and art fairs also contribute to a vibrant culture for residents and students alike.

The sense of community created by a shared identity — whether it's as fellow school alumni or passionate sports fans — is one of the factors why recent grads and young adults are choosing to stay in college towns even after graduation.

A research paper published in 2023 found that about half of recent college graduates live and work in the metro area nearest their college, while 67% remain in the same state.

Even for those who move away after graduation, Ann Arbor remains a strong magnet for alumni and fans' visits.

The eight home games during the 2024 football season generated a total of $226.7 million in direct spending from visitors outside Washtenaw County.

Whether it's for economic opportunities, sports, research, culture, or community, life in Ann Arbor offers a concentrated version of many of the attractions of a much larger city — wrapped in the charming communal identity of a college town.