Purpose: We estimated the 30-day readmission rate of Medicare beneficiaries with diabetes, across levels of rurality. Methods: We merged the 2005 Medicare Chronic Conditions 5% sample data with the 2007 Area Resource File. The study population was delimited to those with diabetes and at least 1 hospitalization in the year. Unadjusted readmission rates were estimated across levels of rurality. Multivariate logistic regression estimated the factors associated with readmissions. Findings: Overall, 14.4% had a readmission; this was higher among urban (14.9%) than rural (12.9%) residents. The adjusted odds indicated that remote rural residents were less likely to have a readmission (OR 0.74, 0.57-0.95) than urban residents. Also, those with a 30-day physician follow-up visit were more likely to have a readmission (OR 2.25, 1.96-2.58) than those without a visit. Conclusion: The factors that contribute to hospital readmissions are complex; our findings indicate that access to follow-up care is highly associated with having a readmission. It is possible that residents of remote rural counties may not receive necessary readmissions due to lower availability of such follow-up care. Policy makers should continue to monitor this apparent disparity to determine the impact of these lower rates on both patients and hospitals alike.