Introduction: Non-alcoholic fatty liver disease (NAFLD) is a chronic liver disease that might affect up to one-third of the adult population in industrialised countries. NAFLD incorporates histologically and clinically different non-alcoholic entities; fatty liver (NAFL, steatosis hepatis) and steatohepatitis (NASH-characterised by hepatocyte ballooning and lobular inflammation ± fibrosis) might progress to cirrhosis and rarely to hepatocellular cancer. Objective: To find out the Non-Alcoholic Fatty Liver Disease in Rural and Urban Population with Type 2 Diabetes Mellitus. Materials and Methods: This was a cross sectional descriptive study conducted in medicine department, Rajshahi medical college, Rajshahi among ninety one T2DM patients. Abdominal ultrasonography for NAFLD detection and grading as well as measurement of blood pressue, BMI, waist circumference, HbA1c, lipid profile, liver function tests were done. All data were analysed by SPSS 16 and p value <0.05 was assumed as statistically significant in this study. Study population included outdoor patients as well as hospitalized consecutive 91 patients (50 Urban and 41 Rural) in the medicine department with type 2 diabetes diagnosed according to the American Diabetes Association (ADA) 2011 criteria. Results: A total of 91 patients were enrolled during the study. The prevalence of NAFLD was higher in urban patients (54.54%) than the rural patients (45.45%). Males were affected more than the female patients in both the groups. Urban population, patients exhibited higher weight, waist circumference, hip circumference, BMI and had earlier age of presentation of NAFLD than the rural population. Both the groups showed high prevalence of metabolic syndrome. Conclusion: In our study revealed higher prevalence of NAFLD in urban population as compared to the rural population with males affected more than the female patients. Although the risk factors for NAFLD were similar in both the study groups, better anthropometric parameters (lower weigh), waist circumference, hip circumference and BMI had a role in reduced prevalence of NAFLD in rural as compared to Urban population patients.