Normally google and search engines do this to find more relevant information for you (ie: ads in your area). Which is a nice gesture as I guess if I wanted to look at ads then I would want relevant ads but most people don't want big brother watching them. There are ways that you can keep old big brother from knowing where you are at. TOR
(The Onion Router) is a program which allows your to virtually mask your public IP so it looks like you are connecting from somewhere else. The way it works is that your packet gets securely bounced around the TOR network and exits out of the network at some random location (like Sweden or Canada (but you can tell it where you want to exit)). Your internet browsing speeds will decrease but your security will increase.
The other thing that it might be is I have seen it happen when you get a Rootkit on your machine where it makes a fake page that tells you the city that you live in and looks like a newspaper. If that might be the case then post in the "I think that I am infected" forum and those guys can help you remove it.
There is a mode in another way to protect your self by using a mode in Firefox called private browsing (Chrome has one called Incogneto and Internet explorer 8 has one called private browsing). Once active it basically doesn't save any browsing cookies or history on the computer and once your done it deletes your session. It is another way to stay safe on the net especially when banking or when your in porn mode (not saying I do this but this is one of the uses for it).
Hope that gives you somewhere to start.