- "I'm sure Lorath adds something to the world, but I can't think of it."
- ―Ser Jorah Mormont
Lorath is one of the Free Cities located to the east of Westeros. It is located on an island just off the northern coast of Essos, east of Braavos. The Shivering Sea lies to its north and an inlet of water known as Lorath Bay is located to the south. Lorath is the least-well-known of the Free Cities, due to its isolated location and the lack of any notable ports to the east.
The people of Lorath are known as Lorathi.
When Cersei Lannister meets Shae for the first time, she recognizes from her accent that she is a Lorathi. Cersei states that she is familiar with the accent because she once had a handmaiden who was from Lorath.
In the books
In the A Song of Ice and Fire novels, Lorath is the least-mentioned of the Free Cities. It is likely influenced by Braavos, as it lies quite close to that city's location. It probably isn't very powerful because there are no major cities further east along the northern shore of Essos. The whale-hunting Inuit-like inhabitants of the island of Ibben probably trade with Lorath, given that it is the closest of the Free Cities to Ibben, yet Ibbenese traders can also be found in Braavos, Pentos, or even as far away as King's Landing in Westeros.
As of the fifth book, A Dance with Dragons, descriptions of Lorath's culture and society are scant to nonexistent, nor have any named characters appeared who come from Lorath. It isn't a mysterious or magical hidden city, rather it seems to be rarely mentioned just because it isn't very powerful or important. Jaqen H'ghar does claim to be from Lorath, but given his true nature as one of the mysterious Faceless Men of Braavos, it is probable that he never even set foot in Lorath.
A change from the books is that Shae is now stated to be from Lorath. Cersei says she had a Lorathi handmaiden once and recognizes Shae's accent. In the books, Shae is just a camp follower of the Lannister army and her back-story is never gone into in detail, but she is from Westeros. The TV producers stated that they changed it so that when she is introduced in Season 1, Shae is stated to be "from the Free Cities" (they hadn't settled on which one yet) because they enjoyed the audition of actress Sibel Kekilli, but wanted to have some explanation for why she speaks with a German accent. As it is, Kekilli is of Turkish descent but was born and raised in Germany, hence her German accent.
Given that Sibel Kekilli speaks with a German accent, and that fellow German national Tom Wlaschiha (Jaqen) also speaks with a German accent, the implication in the TV continuity may be that a "Lorathi accent" is specifically supposed to sound like a German accent (the Faceless Man who took on the "Jaqen" persona wasn't really a Lorathi, but it was a persona meant to convincingly imitate a Lorathi man).