Forgotten Capital (Disc 1) - FF7 Walkthrough
The Forgotten Capital dungeon begins with a fork in the road, you'll want to go left first which is where you will two items for you to collect (Magic Source & Aurora Armlet) as well as a Save Point. Once you've collected both treasures return to the entrance and this time take the right path. There is more loot for you to collect down here too - including the third Enemy Skill Materia!
You'll find the Materia tucked away behind one of the beds in the same building that you can rest inside of. Resting here is required to progress the story forward as well. After you've collected all of the available treasures you'll want to continue down the main path.
Fort Condor Battle #12: After spending the night at the inn but before continuing through the dungeon and fighting Jenova-LIFE you'll be able to do Fort Condor Battle #12.
Enemy Skill Materia
*The most famous scene in the Final Fantasy series
Along the main path when you're given an option to take the blue stairs down you'll want to head up first to grab the Comet Materia. With that in your hand you're free to head on downstairs which is where you will find Jenova-Life, the boss of this dungeon.
You'll also witness the most famous scene in Final Fantasy history at this very location, or what I would argue is the most famous scene. After you beat Jenova you'll be asked to put in Disc 2, or if you're playing on the Ps4/Steam versions you'll get a notice that part 1 is now complete.