The county lines were likely drawn 100-200 years ago. The method will vary by state, but is usually either in a grid or following some geographical features. Where people live probably wasn’t directly taken into account.
Cities lines are drawn as needed, and as cities expand, it just depends on where the population growth is. For mature towns/cities, they may be butted up against adjacent towns, so expansion is driven by whichever people are otherwise “unclaimed.”
But why do cities expand in the first place? Money, prestige (which brings more money), adding services to under-served residents, etc. The question they’re asking when it comes time to grow the borders is, ‘will this bring in more money than it costs in a reasonable amount of time?’ It can be expensive to add services in some areas if they’re expanding water/sewer/police/fire/electric/etc, but the additional tax revenues may be worth it.