Urban or rural locality has been suggested to influence musculoskeletal health, with lower bone mineral density (BMD) and greater prevalence of fracture identified in urban residents. A computer-aided search of Medline, EMBASE, CINAHL and PsychINFO, January 1966 to November 2007 was conducted to identify studies investigating the relationship between urban or rural locality and the occurrence of hip fracture. The methodological quality of studies was assessed, and a best-evidence synthesis was used to summarise the results. Fourteen cohort studies and one case-control study were identified for inclusion in this review, indicating a lack of literature in the field. Best-evidence analysis identified moderate evidence for residents of rural regions to have lower risk of hip fracture compared to urban residents. Examining principal mechanisms for the observed relationship between urban/rural locality and hip fracture, such as factors at the person or area level, may help to identify modifiable risk factors and inform appropriate prevention strategies.