The name is a recurring gag in the series where everyone says Hollywoo instead of Hollywood after the events of Our A-Story is a "D" Story. It is based on the real-life Hollywood area. It has full emergency services coverage and its own fire department detachment. The LAPD 12th Precinct is located here.
The gag references the actual "HOLLYWOOD" sign, which originally read "HOLLYWOODLAND" (the name of a housing development it advertized) before "LAND" was removed by the city of Los Angeles. It was called Hollywood for the first six episodes, before the previously mentioned events of Our A-Story is a "D" Story.
- Prior to Season 1 Episode 7 (Say Anything), during the intro sequence, the sign in the background would indeed say "Hollywood."