Background: A fall is a ubiquitous event experienced by all but, in older adults, it leads to more adverse events. The International Classification of Functioning, Disability, and Health (ICF) framework offers a better understanding of the consequences of falls. Studies concerning the impact of falls on older adults living in rural and urban areas based on the ICF framework are sparse. Objectives: We examined the difference in the fall rate, fall characteristics, and the impact of falls based on the ICF framework in rural and urban older adults. Study Design: We did a cross-sectional survey among older adults living in rural and urban areas in a South Indian district from November 2017 to April 2018. Methods: We included 304 community-dwelling rural (n = 210) and urban (n = 94) older adults in the study. Self-designed data form was used to get the details on age, gender, educational level, visual problems, comorbidities, history, frequency, and fall-related injuries. Based on the ICF framework, we used measures such as the Berg Balance Scale (BBS), modified Barthel Index (MBI), Community Integration Questionnaire (CIQ), and World Health Organization Quality of Life Instrument (WHOQOL-BREF). Results: Out of 210 rural older adults, 101 (48%) experienced falls, and out of 94 urban older adults, 52 (55%) experienced falls. The fall rate did not differ significantly between the rural and urban older adults (odds ratio: 0.86, 95% confidence interval [CI]: 0.57–1.31,P= 0.507). The rural and urban older adult fallers differed significantly in gender (male: 95% CI: 0.06–0.39; female: 95% CI: 0.06–0.39;P= 0.007), education (<10 years: 95% CI: 0.31–0.57; >10 years: 95% CI: 0.75–0.94;P= 0.001), comorbidities (diabetes mellitus: 95% CI: 0.03–0.30; hypertension: 95% CI: 0.04–0.26; no comorbidities: 95% CI: 0.05–0.21;P= 0.001), problem in visual acuity (yes: 95% CI: 0.15–0.39; no: 95% CI: 0.15–0.39;P= 0.001), and frequency of falls (once: 95% CI: 0.01–0.33; recurrent: 95% CI: 0.01–0.33;P= 0.001) and did not differ in age, vocational status, and hospitalization. Except in CIQ scores (95% CI: 2.08–5.91;P= 0.001), they did not differ significantly in the fall-related injuries, BBS, MBI, and WHOQOL-BREF scores. Conclusion: The rural older women and the urban older adults with higher levels of education who had diabetes, hypertension, and visual problems experienced more falls. Although the urban older adults reported a higher frequency of falls, they showed a higher level of community reintegration than the rural older adults.