في المدينة مليون شخص.

Because Arabic often puts the location first when giving an existential meaning like there are ... in ....

So:

• في المدينة = in the city
• مليون شخص = a million people

Putting the place first makes the sentence mean:

• In the city, there are a million people
• more naturally in English: There are a million people in the city

This word order is very common in Arabic.

In Arabic, you often do not need a verb in the present tense for this kind of sentence.

English says:

• There are a million people in the city

Arabic can simply say:

• في المدينة مليون شخص

Literally, this is something like:

• In the city [is] a million people

This is a normal way to express existence in Arabic.
You may also sometimes see يوجد or هناك in similar sentences, but they are not necessary here.

في is a preposition meaning in.

So:

• في المدينة = in the city

Because في is a preposition, the noun after it takes the genitive case. In fully vowelled Arabic, that would be:

• في المدينةِ

The final -i sound marks the genitive.

الـ is the Arabic definite article, meaning the.

So:

• مدينة = city
• المدينة = the city

In this sentence, we are talking about a specific city already understood from context, so Arabic uses المدينة.

This is a very common Arabic number pattern.

After words like:

• مئة / مائة = hundred
• ألف = thousand
• مليون = million

the counted noun is usually singular, not plural.

So Arabic says:

• مليون شخص = literally a million person

But in natural English, you translate it as:

• a million people

So even though شخص is singular in form, the whole phrase means a plural quantity.

For the same reason: after مليون, Arabic normally uses the singular form of the counted noun.

So:

• مليون شخص is the normal structure
• مليون أشخاص would not be the standard form here

This is one of the important differences between Arabic and English number grammar.

If fully vowelled, the sentence would typically be:

• في المدينةِ مليونُ شخصٍ

Here is why:

• في is a preposition
• المدينةِ is genitive because it follows في
• مليونُ is nominative because it is the main noun in the sentence
• شخصٍ is genitive because it is linked to مليون in an iḍāfa construction

So the rough grammatical structure is:

• في المدينةِ = prepositional phrase
• مليونُ شخصٍ = a million people

Because the sentence is introducing an amount, not talking about specific known people.

• شخص = a person / person
• الشخص = the person

In مليون شخص, the phrase means a million people in a general numerical sense, so the noun stays indefinite.

Also, in Arabic existential sentences like this, the noun being introduced is usually indefinite.

Yes. مليون شخص is treated as an iḍāfa-like structure.

That means:

• مليون = the first noun
• شخص = the second noun, specifying what the million consists of

So it works like:

• a million of people in sense, though not in natural English wording

Because of this structure:

• the second noun is singular
• and it takes the genitive case: شخصٍ in full vocalization

Yes, that is possible.

• يوجد في المدينة مليون شخص = There exists / there are a million people in the city

But في المدينة مليون شخص is already completely natural and common. In many cases, Arabic prefers the simpler version without adding a verb.

So:

• في المدينة مليون شخص = natural
• يوجد في المدينة مليون شخص = also possible, slightly more explicit

A careful pronunciation would be:

• fī l-madīnati milyūnu shakhṣin

If case endings are not pronounced, as often happens in pausal or less formal speech, you may hear something closer to:

• fī l-madīna milyūn shakhṣ

The important word stresses are roughly:

• fī
• ma-DĪ-na
• mil-YŪN
• shakhṣ

It is a nominal sentence in Arabic, because it does not begin with a verb.

A simplified analysis is:

• في المدينة = fronted prepositional phrase
• مليون شخص = the main noun phrase being asserted

Arabic often uses nominal sentences where English would use there is / there are.

Usually مدينة means city. In some contexts, translations may vary a little depending on scale and local usage, but city is the standard meaning.

So for a learner, the best reading here is:

• في المدينة مليون شخص = There are a million people in the city