This research study was conducted to discover use of ICT in Distance Education by exploring interest and preference of ICT between students of rural and urban background at Allama Iqbal Open University Islamabad Pakistan. The study was aimed to establish the differences between urban and rural students' interest and preference of ICT in general across the university. This research is based on survey of the respondents from Allama Iqbal Open University Islamabad Pakistan. In order to conduct research a closed-ended questionnaire was developed after studying related literature. The respondents of this study were selected from four faculties of the University by applying cluster sampling technique. Two important constructs; Interest and Preference related to ICT among rural-urban students were investigated. It was concluded from results of the study that most of the respondents from rural and urban areas both used ICT for education related purpose. It was also found that urban students were taking more interest in ICT usage than the rural ones.