Where does the Rime of the Ancient Mariner take place?
There's two possible ways to answer this question. One, the rime is told at a wedding, by one of the wedding guests, so you could say the rime itself takes place at a wedding. The story itself takes place on the open ocean, as a cursed ship (one of the men killed an Albatross, a traditional and superstitious sign of good luck for Mariners) encounters spiritual forces associated with the curse.
So, as a tale told at a wedding or aboard a ship on the high seas would be my answer to that question.
Although the exact location of the seaport used as the setting of Samuel Taylor Coleridge's epic poem, "The Rime of the Ancient Mariner," is never given, the reader can assume that it is probably a British coastal city--possibly London. While telling his story outside a wedding, the mariner does describe an earlier voyage he takes to the South Pole, and he spends much of the poem adrift on the high seas. Likewise, the ocean in which the mariner sails is also not named.
The setting of the story begins outside of a wedding hall. An ancient Mariner then accosts a wedding guest and forces him to listen to the Mariner's tales of ocean going adventures. The tale is told of a trip to the South Pole in which the Mariner kills an albatross, is cursed, and is eventually reborn as a person who appreciates all living things. The Mariner is then forced to tell his adventures to all people who listen. The poem is told in a simplistic rhyme pattern. It is truly one of the great poems in English literature.