Kota Indah is the name of a small red light area with around 10 bars, clubs, spas and karaokes in North Jakarta. It is located in a street perpendicular to Jalan Pangeran Jayakarta in Glodok. For this reason, it is sometimes referred to as Pang-J or Pen-J.
This is a map of the exact location (Kota Indah streets are highlighted in green):
It is walking distance (10 minutes by foot) from Station Kota which can easily be reached with Transjakarta buses. You can also sleep in nearby hotels such as Ibis Mangga Dua, Best Western Mangga Dua, Le Grandeur or Orchardz (that includes a naughty spa).
The visitors of Kota Indah are almost all Indonesians, usually older than average. They come to do 3 things: Drink alcohol, listen to music (sometimes sing along) and have sex with prostitutes.
Most of the venues have a similar concept of bar + massage. The ground floor is typically a lounge with either a DJ or live music, and girls waiting in sofas. After you sit down, a mamasan will come to your table and ask if you want to be accompanied by a girl while you drink. This is free but it is expected that you buy at least a drink to your lady companion. Upstairs, there are private rooms where you can bring the girl (for a price between Rp300,000 and Rp350,000 paid in advance + a tip of Rp50,000 to Rp100,000). It is not compulsory to be with a girl, you can just sit alone like in any normal bar if that's what you are looking for. You can also go straight to the room and skip the bar. Note that in most bars, the massage is not a real one, it is just sex.
The most famous venue on the street is Grand MTR 1 (MTR 2 is in Kelapa Gading) in which you have live music (Indonesian and International songs) and sexy nude dancers. Other venues include Royal Massage, Sari Ayu Spa, Astro Bar, Grand LA Bar and a few others.
Kota Indah is a bit more dodgy than famous prostitution centers like Classic or Travel, but it is still clean and comfortable. Foreigners are welcome, but don't do anything stupid as the whole street is managed by a gang (Laskar Merah Putih).