The Model:

class Address
{
    public string City { get; set; }
    public string Zip { get; set; }
}

The Controller:

[HttpPost]
public ActionResult GetAddress(Address model)
{
    if (!String.IsNullOrEmpty(model.Zip))
    {
        model.City = GetCityByZip(model.Zip);
    }
    return View(model);
}

The View:

<div class="formrow">
    @Html.LabelFor(model => model.City)
    @Html.TextBoxFor(model => model.City) 
    @Html.ValidationMessageFor(model => model.City)
</div>
<div class="formrow">
    @Html.LabelFor(model => model.Zip)
    @Html.TextBoxFor(model => model.Zip) 
    @Html.ValidationMessageFor(model => model.Zip)
</div>

The problem is whenever the city is being modified, it never gets reflected on the view. During debugging, the model.City contains the correct value but it doesn't show up on view. Even something as simple as @Html.TextBoxFor(model => model.City) doesn't display the correct model.City value.

As Tommy noted, this is, somewhat counterintuitively, the correct behavior since form data submitted on post gets first priority when binding the data to the returned view. This makes some sense as the user is likely to have made a validation error when re-returning the same view and gets to resume their form entry as is without the problems of losing form input when restoring a page

One other option is to manually insert the value for the input

So instead of this:

@Html.TextBoxFor(model => model.City)

Do this instead:

<!-- language: lang-html --> <pre><code>&lt;input type="text" name="City" <b>value="@Model.City"</b> /&gt; </code></pre>

* which will grab the value directly off the model

Or even better:

<input type="text" value="@Model.City"
       name="@Html.NameFor(model => model.City)"
       id="@Html.IdFor(model => model.City)" />

*Note: this won't bring in data-val attributes. If you're using them on this property for client side validation, you'll need to build list of data validation attributes for a given element

Additional Resources