Godric's Hollow is one of several villages across Britain with a community of wizarding families. Hogwarts founder Godric Gryffindor was born in the village. The village was the location of Voldemort's fatal attack on the Potter family.
When the war memorial in the village square is passed by a witch or wizard, it transforms into a statue of Lily, James and the baby Harry Potter, commemorating the night of Voldemort's attack. The Dumbledore family used to live in Godric's Hollow, and Kendra and Ariana Dumbledore are buried in the graveyard there. Lily and James Potter's grave lies two rows behind the Dumbledore's.