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Dubai is the second largest emirate in the federation after Abu Dhabi. The emirate is located on the Persian Gulf, southwest of Sharjah and northeast of Abu Dhabi, and reaches into the interior. The town of Hatta is a segregated portion of the emirate of Dubai and borders Wajajah, Oman.

Non-Muslims in the country are free to practice their religion but may not proselytize publicly or distribute religious literature. The Government follows a policy of tolerance towards non-Muslim religions and, in practice, interferes very little in the religious activities of non-Muslims.

Dubailand, a proposed entertainment complex, is to include the Mall of Arabia, the largest shopping mall in the world. Dubailand is slated to open in 2006.

Apart from donated land for the construction of churches and other religious facilities, including cemeteries, non-Muslim groups are not supported financially or subsidized by the Government. However, they are permitted to raise money from among their congregants and to receive financial support from abroad. Christian churches are permitted to openly advertise certain church functions, such as memorial services, in the press.

Dubai has become an important tourist destination, helped by its rapidly-expanding airline Emirates, which is headed by Sheikh Ahmed bin Saeed Al Maktoum, an uncle of the emir. Dubai is also diversifying as a hub for service based industries such as IT and finance, with the new Dubai International Financial Centre or DIFC. The government has set up enclaves and freezones for industry specific corporations. Dubai Internet City, now combined with Dubai Media City as part of TECOM (Dubai Technology, Electronic Commerce and Media Free Zone Authority) is one such enclave and houses IT companies such as EMC Corporation, Oracle, Microsoft and IBM, and media organisations such as MBC, CNN, Reuters and AP.

Dubai is fairly unique in that its population consists mainly of expatriates, with UAE Nationals (Emiratis) constituting the minority. The vast majority of these expatriates come from the Indian subcontinent and the Philippines. The UAE government does not allow any form of naturalization or permanent residence to expatriates. Even children born in the country are not granted citizenship, unless a parent is a UAE national. Discrimination against Asian expatriates is common. Salaries for lesser qualified citizens are usually several times that of a much higher qualified expatriate. Reports of Emirati employers defaulting on several months salaries are quite common. Expatriates from Western countries however, do not face such discrimination.

The first villa freehold properties that were occupied by non-UAE nationals were The Meadows, The Springs and The Lakes, all masterplanned communities designed by Emaar, resulting in luxurious upperclass neighbourhoods collectively known as Emirates Hills. Over the 2005-2006 time frame, most of the freehold skycrapers and other villa projects will be ready for occupation, sparking a new phase in Dubai's history as a city.

Islam is the official religion of all the emirates. A vast majority of the people are Sunnis. There are foreign minority Hindus and Christians as well. Dubai is the only Emirate to house a Hindu temple.

There are an increasing number of "freehold" villas and flats which come with a guaranteed residence visa renewable every three years for a around US$1350 per person. The Jumeira Palm, an artificial island in the shape of a palm tree, is one of these. It is illegal to seek employment on this visa though, and a separate job visa must be obtained from an employer. It is common practice among Dubai employers to hold on to employees' passports for the duration of the employment contract. This is done to prevent expatriate employees from moving to higher paying jobs. On termination of an employment contract, expatriates and their families are usually banned from the country for six months.

In early 2001, ground was broken for the construction of several churches on a parcel of land in Jebel Ali donated by the Government of Dubai for four Protestant congregations and a Catholic congregation. In May 2001, the Crown Prince of Dubai authorised the construction of a Greek Orthodox church on donated land.