Vatican City is a separate sovereign state within Rome, created in 1929 and run by the Pope (who is the supreme monarch!). The official population is a little over 800 and it covers an area of 110 acres (44 hectares). Within the walls of the city are St Peter's Basilica, St Peter's Square, the Vatican Museums, the residence of the Pope and offices of the Catholic Church. Being a separate state, the Vatican has its own postage stamps, and the official language is Latin (as well as Italian). It has its own bank and the world's only ATM with instructions in Latin! Although it uses the euro, the Vatican does issue its own coins. The economy revolves around tourism, printing, mosaics and manufacturing uniforms (who knew!). There are two forces for law and order; one is the Gendarmerie, who keep order, the other is the Swiss Guard (notable for their crazy yellow, blue and red uniforms) the Pope's personal bodyguard since 1506. All 134 members are indeed from Switzerland.
Practical Info
Vatican City is easy to reach. Take metro line A to stop Ottaviano-S.Pietro-Musei Vaticano or Cipro. Tramway 19 to Piazza del Risorgimento, or various buses. You can also walk from the centre of Rome across Ponte Sant'Angelo and up towards the Piazza San Pietro for the most breathtaking approach.