Long Strings, Anomaly Cancellation, Phase Transitions, T-duality and Locality in the 2d Heterotic String

We study the noncritical two-dimensional heterotic string. Long fundamental strings play a crucial role in the dynamics. They cancel anomalies and lead to phase transitions when the system is compactified on a Euclidean circle. A careful analysis of the gauge symmetries of the system uncovers new subtleties leading to modifications of the worldsheet results. The compactification on a Euclidean thermal circle is particularly interesting. It leads us to an incompatibility between T-duality (and its corresponding gauge symmetry) and locality.