U selu žive moja baka i moj deda.

Because u can take two different cases depending on meaning:

• u + locative = in/at a place, when there is no movement
• u + accusative = into/to a place, when there is movement toward it

Here, the sentence describes where the grandparents live, so it uses location, not motion:

• u selu = in the village

Compare:

• Žive u selu. = They live in the village.
• Idem u selo. = I am going to the village.

So selu is the locative singular of selo.

Selu is in the locative singular.

The noun is:

• nominative: selo = village
• locative: selu = in the village / at the village

It appears in the locative here because it follows u in a location meaning.

Because the subject is plural: moja baka i moj deda = my grandmother and my grandfather.

In Serbian, baka + deda means two people, so the verb must be 3rd person plural:

• živi = he/she lives
• žive = they live

So:

• Moja baka živi... = My grandmother lives...
• Moj deda živi... = My grandfather lives...
• Moja baka i moj deda žive... = My grandmother and my grandfather live...

Serbian word order is much more flexible than English word order.

This sentence starts with the place, then gives the verb, then the subject:

• U selu žive moja baka i moj deda.

A very natural English-like order would also be possible:

• Moja baka i moj deda žive u selu.

Both are grammatical. The version with U selu first gives a little more emphasis to where they live. Serbian often moves parts of the sentence around for focus, rhythm, or style.

In Serbian, possessive words like moj / moja / moje must agree with the noun they describe.

So:

• baka is feminine singular → moja baka
• deda is masculine singular → moj deda

That is why you see both forms.

English uses the same word my for everything, but Serbian changes the form depending on gender and number.

Because Serbian nouns have grammatical gender.

• baka is feminine, so it takes moja
• deda is masculine, so it takes moj

Some forms of moj:

• masculine singular: moj
• feminine singular: moja
• neuter singular: moje

So the possessive must match the noun’s gender.

Yes, you sometimes can, especially in casual speech, if it is already clear that my applies to both nouns.

So these are both possible:

• moja baka i moj deda
• moja baka i deda

However, repeating the possessive is often clearer and more balanced, especially for learners. In this sentence, moja baka i moj deda sounds fully explicit and natural.

The basic dictionary form is usually živeti (Ekavian) or živjeti (Ijekavian), depending on the standard variety.

The present tense forms are:

• ja živim = I live
• ti živiš = you live
• on/ona živi = he/she lives
• mi živimo = we live
• vi živite = you live
• oni/one/ona žive = they live

So žive is the 3rd person plural present form.

Yes. Deda is a very common word meaning grandfather or grandpa, depending on context and tone.

Similarly:

• baka = grandmother / grandma

In everyday speech, baka and deda are extremely common and natural.

Because Serbian usually does not need subject pronouns when the verb form already shows the person and number.

The verb žive already tells you it is they live, so a separate oni is unnecessary.

Serbian often omits pronouns unless they are needed for emphasis or contrast.

So:

• Žive u selu. = They live in the village.
• Oni žive u selu. = They live in the village.
  (with extra emphasis on they)

Not exactly.

• u selu usually means in the village — referring to a specific village as a place
• na selu usually means in the countryside / in a rural setting

So:

• Žive u selu. = They live in the village.
• Žive na selu. = They live in the countryside.

Sometimes the English translation may look similar, but the Serbian expressions are not identical.

Yes, absolutely.

You do not have to preserve Serbian word order in English. A natural English translation would often be:

• My grandmother and grandfather live in the village.

Even though Serbian begins with U selu, English usually prefers the subject first unless you specifically want to emphasize the location:

• In the village, my grandmother and grandfather live.
  This is grammatical in English, but much less natural in ordinary speech.

So the Serbian word order does not force the English translation to sound the same.

Yes. For many neuter nouns like selo, the locative singular often ends in -u.

For example:

• selo → u selu
• more → na moru
• polje → na polju

So -u here is a normal case ending showing that the noun is in the locative singular after the preposition u.