The town formerly known as Skrunda-1 was built around a radar base that was part of the Soviet Union's early warning system. It was mothballed 12 years ago not long after Russian military personnel left the country.
The town has 70 buildings, including apartment blocks, a school, hotel and hospital -- most of which are in bad condition. The starting price at Friday's auction is the equivalent of about $300,000, the price of a four-room apartment in Riga, Latvia's capital.
Government officials won't reveal how many bidders will participate in the auction but says one buyer takes all.