Sesame Gulch is a Western town and the primary location of the various Old West sketches on Sesame Street. Although not named on the show itself, Sesame Gulch is specified as the setting in the books Tales of Sesame Gulch (1977) and particularly in The Sesame Street Dictionary (1980), which showcases the town extensively.

The signpost lists the town population as 8. Documented residents include Rodeo Rosie, Marshal Grover and Fred the Wonder Horse, Bad Bart, The Great Cookie Thief, and an assortment of Anything Muppet cowpokes.

In the sketches, a stereotypical Western saloon is a frequent setting, but Sesame Street Dictionary clarifies that it is actually a milk bar. Other businesses include the Sesame Gulch Hotel (which boasts cable TV; Granny Fanny Nesslerode is a known guest) and the train depot (where Cookie Monster is the engineer, in an apparent reference to "The Ballad of Casey McPhee.") Principal recreational activities include card playing, milk drinking, horse riding and cow herding, counting, and jumping to conclusions.