Technically, dungeons as such have never really existed in RL - at least not in the sense of an underground trap-filled fortified area used to guard some object, person, etc.
However, there have been underground crypts, underground settlements (well, partially underground, and mostly in modern times), and ruins buried by time and thus underground (albeit filled with sediment except for the occasional air pocket in a room).
There are thus two ways to look at this city:
1) It was always underground, perhaps a dwarven settlement or some other race's settlement. In this case the settlement is likely entirely open (ie: few if any filled chambers / passages), and it is similarly obvious that the 'dungeon' is, in fact, a former city (or revived city, perhaps, although used now by another race).
2) It was above ground but buried by sediment over the ages. Perhaps some local creatures or races have hollowed out some of the avenues, rooms, etc for their use, but it is likely that 25-75% of the settlement is still underground - perhaps with other air pockets, riches (from stores, banks, vaults, etc) yet to be discovered, etc.
In this situation it may be difficult to determine the extent of the 'dungeon'. It may not, in fact, be initially possible to determine that it was once a settlement at all, although the fact that it was at least one or more buildings near each other at some time in the past may be obvious. Perhaps the city has been partially excavated - via tunnels, by some race that prefers living underground. Adventures could include finding information on the former settlement at distant cities - in libraries, universities, oral legends, etc, then returning to make use of that knowledge to find structures currently still buried and unknown - along with whatever riches, wonders, etc may be within them.
Other adventures could involve the team being captured or chased while in the settlement - and accidentally finding a previously unknown passage. The danger outside is such that they decide to follow (and perhaps even excavate a bit on their own) the passage / rooms now revealed to them, eventually discovering this or that interesting thing, situation, knowledge, etc.
In the case of the former idea (ie: the settlement is obviously a settlement of another race from a bygone age, now refurbished for use by the current race that occupies it), you would design the settlement / city as you normally would a dwarven, drow, kobold, etc settlement. It is only a dungeon if the current inhabitants have chosen to place various traps about, bring down some walls and build up others to create a confused mass of twisting passages, etc - the better to defend themselves and their settlement from dangerous intruders, such as adventurers.
In the second stated idea, you could create a city plan as normal, but then cover up most of it, leaving only the few largest buildings and the widest avenues near them uncovered (as they would have been most easily found, thus leading to the formation of the new settlement or dungeon as they were unburied). Some various minor buildings and lesser avenues and even alleyways might also be uncovered / tunneled, as digging continues, but most of the city is still fully buried. Then decide which structures were larges within and best able to hold up under the weight of centuries of being buried under tons of soil. Those should have air pockets that might be breathable (or not, perhaps, but will certain gather interest if they are stumbled upon by the diggers).
Also, consider what structures were likely to have magical protections - these might not only have air bubbles, but also the magical traps, misdirections, protections, etc that might work well for a stumbled upon dungeon. Lastly, consider the sewer system. These are made to be underground, after all, and may offer both the initial means into the city (by the new settlers / dungeon builders or by the adventurers, seeking another way in / out) and the random collapses that surely occurred could make a nice maze - as well as offering a complex and perhaps as yet unknown means of moving about the partially excavated city and into as yet unknown structures.
Needless, to say, I prefer the second option.
