Symbolism, Imagery, Allegory
When Gareth and his servants catch their first glimpse of Camelot, it seems to shimmer in the mist and even to disappear at times. The city is protected by a gateway guarded by the Lady of the Lake and the Three Queens into which were “Arthur’s wars in weird devices done / New things and old co-twisted as if Time / were nothing” (“Gareth,” 221-223).
When Gareth asks the gatekeeper whether the city is real or not, he explains that it was built by fairies and that whoever passes through the gate will become a slave to Arthur’s enchantments, for he “Will bind thee by such vows as is a shame / A man should not be bound by” (266-267). As to whether the city is real or not, some say that the king is the only real thing in it, and others that the city is real and the king a shadow. So yeah, Camelot's a bit of a mystery no matter which way you slice it.
But it's more than just mystery. We here at Shmoop thinking Camelot most obviously represents the ideal society that Arthur is trying to create—a vision in the distance that fades in and out of sight, guarded by principles (the Three Queens), whose reality depends upon the purity of those who form it.
Of course suggesting that this world is created by fairies or enchantment implies that Arthur’s dream may be nothing more than a silly fantasy. The gatekeeper tells Gareth that the city is built “To music, therefore never built at all, / And therefore built for ever” (273-274). This music probably represents the principles or ideals by which men rule society, symbolized by the city. Since nobody’s perfect, this perfect city can never actually be completed. On the other hand, as long as people are trying to live up to their ideals, the city is “built for ever.” So there's that, at least.