A city in the Mnar region of the Dreamlands, populated by proud and warlike humans who are believed to have conquered the Beings of Ib and stolen their green stone idol to Bokrug.
In Chapter 102, the Yellow King referenced it as being (potentially) reachable by traveling west (in other words, towards civilization) from the Forsaken Caravanserai through the Eastern Desert.
In Chapter 125, Dora recalled some more information about Sarnath:
The history of Sarnath is long, but simple. Defined, really, by a scant handful of facts—which is (Dora believes) fairly unusual for a location in the Dreamlands. Her guess is that this may have something to do with the area being WAY off the beaten path, very far from the various seas, far from the cities, far from the Garden Lands or the Fantastic Realms, and maybe a ton of mortal dreamers just don’t end up there. Like, its Story is progressing, but without a bunch of dreamers witnessing it, or MESSING AROUND with it… its Story is just slowly unfolding at its own pace. That’s, at least, what Dora thinks. But what Dora does know about Sarnath’s story, is that it is one of Revenge.
And maybe that has something to do with the fact that the LITERAL GREAT OLD ONE OF REVENGE, lives there?
At the heart of the region of Mnar, there is a lake with no name, to and from which no river flows. At the bottom of the lake sleeps the Great Old One Bokrug. An unknowable length of time ago, a species of aliens descended from the stars and built a city of stone in a marsh upon its shores. The Beings of Ib were hideous in appearance, but peaceful in demeanor. They wished nothing more than to live in harmony and pray to their slumbering god beneath the waters. And they did so, disturbing nobody, for eons.
Then some humans found this lake and built a city of their own: Sarnath. Sarnath rose, and grew, and eventually the people of Sarnath found the Beings of Ib. And when they did, repulsed by their eerie appearance, they killed them on sight. And then began the cycle of Revenge. The Beings of Ib struck back, and the people of Sarnath struck back harder. On this went, until finally the humans rose en masse and committed a complete and utter genocide, destroyed the city of Ib utterly, and marched back to Sarnath dragging the holy statue of Bokrug behind them through the mud.
That would seem to be the end of the story, except…. every year, on the anniversary of the slaughter of the Beings of Ib, a storm with seemingly no source rises over this nameless lake. And legend says that every year, it grows stronger. And legend seems to imply that this storm is, of course, the slumbering Great Old One slowly wakening below the waters to bring about a final act of Revenge upon those who killed his children.
In Chapter 135, Pumpkin counseled Dabwick not to go to Sarnath. He said that there was something there one must not behold, at least if they value their minds–that the concept of Revenge has “taken flesh” there.
In Chapter 137, the party traveled to Sarnath by means of the Dreamlands Excursion ritual, arriving inside a massive palace during the “Millennium Celebration.” The party was a wild bacchanal, like a party at the end of the world, soon interrupted by the arrival of vengeful Ib Shades. A terrible storm was hitting the city at the same time, seemingly growing in intensity in time with the arrival of something massive out in the lake.
First Reference: Chapter 101
Other Notable References: Chapter 102, Chapter 125, Chapter 135, Chapter 137, Chapter 138, Chapter 139, Act IV Interlude Part 1