Lost Shelter was a small Atmoran town sitting right next to the Ghost Sea. It was abandoned during the civil war in Atmora and was buried underneath the ice leaving it perfectly preserved for a few thousand years.
During the Forth era the ice covering it was mysteriously melted off the town leaving it plain to see for Natalia's people when they arrived their fleeing the wars in Tamriel. Those people sheltered here and Natalia gave it its name. Then after a few days Natalia and her people abandoned the town after seeing an approaching storm and sheltered in a Dwemer outpost up north which they called Lot Drem. The town after the storm was nearly reduced to rubble after heavy winds and snow pounded it. Then after Natalia's people raised the crystal into the sky some of them moved back there rebuilding it.
Lost Shelter was unaffected by the Bruniick Jul threat that came in later years and continued to prosper. Having the only boats in the entire kingdom due to the lack of wood, Lost Shelter became the main source of fish, feeding the kingdom and keeping it far away from starvation when the outlying farmlands in the north were attacked. This caused Lost Shelter to grow from the town it once was, and with more people coming in from the north because of the Brunnick Jul attack’s this only grew it further