Dili is a city: the capital of East Timor, also called Timor-Leste. The country is small, in Southeast Asia, on an island north of Australia. The government sits in Dili, and so does the main port; much of the country’s public life runs through this one city. In English it is only a place name. You capitalise it. It is not an ordinary word for anything else, and it is not the herb dill, even though they can sound close if you say them fast.