South Africa has one of the highest university dropout rates in the world. As a country, it also has a history of forced location and the withholding of resources, including quality education, from certain rural areas. This study investigates, the effect of urbanization (of the area in which a student resides) on the dropout rate of distance students in an introductory taxation course. Using Kember's longitudinal-process model of dropout from distance education as a point of departure and interrogating the "characteristics" of students, it was found that the effect of urbanization on its own only accounted for a 1% higher dropout rate for rural students over their urban peers. When urbanization, as a variable, was combined with other demographic variables, the outcomes were sometimes unexpected. Ten multi-variable comparisons indicated that rural students always represented the students who dropped out the most. However, in four of these multi-variable comparisons, rural students were also those who dropped out the least. A further study could examine the characteristics of population groups and language groups within rural communities to ascertain why certain students drop out more than others. Recommendations are made for specific interventions that could assists in supporting students that are prone to dropout. (Contains 1 table.)