This is the 733rd most frequent Russian word.
поселке
"Посёлке" is the prepositional case of "посёлок," meaning "village" or "settlement" in English.
'Поселке' in this context describes the place where the activity of 'walking' took place.
Мы гуляли по поселке весь вечер.
We walked through the settlement the entire evening.
'Поселке' is used to indicate the location where the school was constructed.
Они построили новую школу в поселке.
They built a new school in the settlement.
'Поселке' here refers to a small residential area or settlement, specifying the location of the houses.