Youu might want to try "Finder: a novel of borderland" by Emma Bull.

The story takes place in Bordertown, where elves, humans and halflings (half elf and half human) coexist near the edge of the Nevernever, a country to which only pure Trueblood elves can go. A designer drug that mutates humans and halflings so they become more like Trueblood elves is being used by those desperate to enter the Nevernever. There is a problem, however: the drug horribly kills its users before they complete the mutation process. The tale's human hero, Orient, who has a magical talent for finding lost items, is recruited by Sunny Rico, a policewoman dedicated to seeking out the drug's creator. As they search, love and betrayals flourish, and we learn much about the depths of elven-human friendships. Bull has proved in past works that she can weave a web of magic and truth around her characters. Finder is not as original and exciting as Bone Dance , but this stylishly dark piece displays the author's virtuosity with pathos and command of melodious language. It's yet another case of good writing triumphing over a mediocre concept in the land of the fantastic.

I had bought a copy of Bordertown: A Chronicle of the Borderlands by Terri Windling, Mark Alan Arnold and fell in love with this town. The is book was full of short stories. The first books are hard to find now that they are out of print. But you can find on amazon:

1)Essential Bordertown: A Traveller's Guide to the Edge of Faerie
by Terri Windling, Delia Sherman

The next few are for young adult books but they all take place in boardertown:

2) "Finder: a novel of borderland" by Emma Bull.( I just finshed this book and loved it. The characthers where from one of the short stories in Bordertown: A Chronicle of the Borderlands. But you don't need to read the first books to follow the story).

3)"Elsewhere" by Will Shetterly

4) "Nevernver" by Will Shetterly ( sequel to Elsewhere)

You might want to also try "War for the Oaks" by Emma Bull.

Last Call was excellent. I've not read the others.

I loved Weaveworld and The Great and Secret Show.