Not strictly local, but WPLJ in New York is named for a Frank Zappa song.
There used to be a WAST around here, for Albany, Schenectady, & Troy.
WGY used to bill itself as “The first letter in General Electric and the last letter in Schenectady.”
KBOI, AM 670. for BOIse.
KIDO, AM 580, for IDahO. This was the first standard broadcast station to be licensed in Idaho.
That Frank Zappa song is a cover of a '50s R&B record by The Four Deuces.
Apparently they opt to refer to themselves as Martini Lounge Radio.
KAPE in Cape Girardeau, MO.
How about WARE in Ware, Mass?
Austin, Texas has KLBJ.
New York City has WNEW.
In the next county, where there are a number of dairy farms: WCOW.
Sparta WI: go south till you smell it and west till you step in it.
WILK is in Wilkes-Barre, Pennsylvania
WKRP actually exists, and is in Salt Lake City, of all places (where most stations follow the “K-West-of-the Mississippi” rule, but not this one). I wonder if it had anything to do with Gordon Jump. I know he appeared in a few plays there.
Before Turner bought the letters for his Cable TV station, WTBS used to be the MIT Student radio station. It stood for Tech Broadcasting System. (MIT is “Tech” to the inmates)
WPIX-TV, for the Daily News (“New York’s Picture Newspaper”).
KRON-TV, for the San Francisco Chronicle (often called the “Chron”).
WTOP, Washington, got its call from being at the TOP of the AM dial (then 1500 kHz).
New Haven used to have WELI, named for old Eli Yale.
Detroit has had both WCAR and WLLZ (“Wheels”).
Toronto has CHUM.
Des Moines, IA, has KIOA, and up in Mason City, KRIB used to ID as “from the Crib of the Cornbelt.”
In the 1930s the feds were running out of spectrum on the AM (then just called broadcast) band and certain stations had to share frequencies. In Grand Rapids, a lumberyard operated WOOD, then signed off each day to make room for WASH, run by a laundry. Seriously.
Not to be confused with its “sister” station, KCOB (Newton, Iowa).
Then there is KTIT, which to my knowledge does not actually exist, but which was a name once proposed for a public broadcasting affiliate - so that they could use the slogan “KTIT needs your support”. 
Forgot Van Wert, OH, where you will find WERT.
The Detroit police operated KOP from 1922-'25. 
They’re not radio call letters, but TV ones – they’re the Roman Numerals for the station. Like WXXI, PBS Channel 21 in Rochester, NY, or WLVI, independent channel 56 in Boston. I know there’s at least one more, and probably quite a few.
There’s also WOC (AM radio and TV) in Davenport, Iowa. WOC (at least in the popular imagination) stands for “World Of Chiropractic” in (honor?) of the city’s Palmer College of Chiropractic, the first school of its kind and sort of a high temple for believers in the subluxation theory of disease.
Well, there’s CITE (107.3 FM) in Montreal, presumably chosen not for its ability to quote facts but because the French word cité (“city”) implies urban coolness, of which Montreal has lots.
If there’s any particular significance to the call letters CINQ (“five”) at 102.3 FM, it escapes me.
Milwaukee has WTMJ, which stands for The Milwaukee Journal, which owns (or at one time owned) the station.
I was always told that Chicago’s WBBM stood for World’s Biggest BM. Noone would tell me what the BM stood for, though.
We have two stations in Milwaukee that I believe are owned by the same person, they are WMIL and WOKY, if you put them together it’s wMILWOKY.
That’s half right. WASH was owned by a laundry, WOOD was not owned by a lumberyard.
According to Wikipedia, the station that originally occupied that frequency was WEBK, owned by the Baxter Laundry Company with backing from the Furniture Manufacturers Association of Grand Rapids. Also, WOOD had the night broadcast and WASH the day broadcast. Michigan’s Radio & TV Broadcast Guide says WASH began broadcasting as WBDC at 1170 on 13 March 1925 and changed to WASH a year later. WBDC was also owned by Baxter.
Also according to the Guide, an outfit known as The Grand Rapids Radio Company took over ownership of WEBK when it was changed to WOOD in '26. The Grand Rapids Radio Company was apparently bought out by Walter B. Stiles, Jr. and his Furnwood Broadcasting the next year.
OK - since I see some acronyms creeping in, WICC, in Bridgeport, CT got it’s name because when the station was founded, Bridgeport was the Industrial Capital of Connecticut.
Olive
WDTN and WHIO and are both located in DAYTON, OHIO.