Why did most city states have defensive walls in ancient times?

There are two reasons for this.  First, they had the walls
because they were necessary.  Second, they had the walls because they were
effective.

Cities needed walls so that they could not be
easily attacked.  People from bandits to outright armies would have been interested in
attacking and looting cities.  The cities needed walls to make it so that attacking them
would be too difficult.  This would mean that they would be much less likely to be
attacked.

Cities had walls because walls worked.  In the
times before modern artillery (cannons) walls were rather effective.  Armies, let alone
bandit bands, did not have effective ways to knock walls down from long distances.  This
meant that the walls were actually useful in ways that they were not useful after
powerful cannon were invented.

Cities had walls, then,
because they were effective ways to prevent attacks on those
cities.