Mike Pondsmith, creator of the Cyberpunk universe, stated that "Night City is still there" in Cyberpunk 2. This means the sequel has not completely abandoned Night City, but how the city will appear remains unclear at present.
Pondsmith mentioned this during a recent Cyberpunk RED tabletop RPG session, which also featured CD Projekt RED staff. He gave the above response when asked about the geographical setting of Cyberpunk 2, but did not elaborate on whether Night City would be the main stage, an explorable area, or appear in some other form.
Analyses surrounding this statement have suggested the possibility of a "dual-city structure," with Chicago and the massive East Coast metropolitan area known as the "Plex" listed as candidate locations. However, these specific locations come from player theories or analyses and have not been confirmed by the project team.
Cyberpunk 2 is currently being developed by CD Projekt RED's new team in Boston, and the project is still in early production, with several years to go before release. At this stage, the only certainty is that Night City remains connected to the sequel; the full map composition awaits further official disclosure.