Replace xml tag contents using python

UPDATE - XML PARSER IMPLEMENTATION : since replace a specific <Location> tag require to modify the regex i'm providing a more general and safer alternative implementation based upon ElementTree parser (as stated above by @stribizhev and @Saket Mittal).

I've to add a root element <Emps> (to make a valid xml doc, requiring root element), i've also chosen to filter the location to edit by the <city> tag (but may be everyfield):

#!/usr/bin/python
# Alternative Implementation with ElementTree XML Parser

xml = '''\
<Emps>
    <Emp>
        <Name>Raja</Name>
        <Location>
            <city>ABC</city>
            <geocode>123</geocode>
            <state>XYZ</state>
        </Location>
        <sal>100</sal>
        <type>temp</type>
    </Emp>
    <Emp>
        <Name>GsusRecovery</Name>
        <Location>
            <city>Torino</city>
            <geocode>456</geocode>
            <state>UVW</state>
        </Location>
        <sal>120</sal>
        <type>perm</type>
    </Emp>
</Emps>
'''

from xml.etree import ElementTree as ET
# tree = ET.parse('input.xml')  # decomment to parse xml from file
tree = ET.ElementTree(ET.fromstring(xml))
root = tree.getroot()

for location in root.iter('Location'):
    if location.find('city').text == 'Torino':
        location.set("isupdated", "1")
        location.find('city').text = 'MyCity'
        location.find('geocode').text = '10.12'
        location.find('state').text = 'MyState'

print ET.tostring(root, encoding='utf8', method='xml')
# tree.write('output.xml') # decomment if you want to write to file

Online runnable version of the code here

PREVIOUS REGEX IMPLEMENTATION

This is a possible implementation using the lazy modifier .*? and dot all (?s):

#!/usr/bin/python

import re

xml = '''\
<Emp>
<Name>Raja</Name>
<Location>
     <city>ABC</city>
     <geocode>123</geocode>
     <state>XYZ</state>
</Location>
</Emp>'''

locUpdate = '''\
    <Location isupdated=1>
         <city>MyCity</city>
         <geocode>10.12</geocode>
         <state>MyState</state>
    </Location>'''

output = re.sub(r"(?s)<Location>.*?</Location>", r"%s" % locUpdate, xml)

print output

You can test the code online here

Caveat: if there are more than one <Location> tag in the xml input the regex replace them all with locUpdate. You have to use:

# (note the last ``1`` at the end to limit the substitution only to the first occurrence)
output = re.sub(r"(?s)<Location>.*?</Location>", r"%s" % locUpdate, xml, 1)