The Barrio La Merced is essentially the southeast corner of Mexico City's Centro Histórico. Like most of the City's "barrios," it's conceptually understood, but doesn't correspond to a modern territorial designation. For lots of City residents, la Merced will always mean the Merced Market. In fact, the market, now to the east, is so big, it's nearly a neighborhood on its own.
But the Merced neighborhood pre-dates the market. It recalls a time when nearly every neighborhood, or small town, was named for its reigning religious institution. In this case, it was the Merced Monastery, one of the most important in New Spain, and certainly in Mexico City.
The monastery is gone today, although a small and illustrious part of it can be visited. In its place is a neighborhood that teems with commerce, but also with homes, schools, and government buildings.
In the City Center, it's a must-visit. If you're on your way to the market, the Barrio Merced provides a better understanding of Mexico's long tradition of tianguis shopping, the cries of the vendors, and the flavors of the Mesoamerican past.