Background: There has been emerging evidence from country-level studies that disability prevalence tends to be lower in urban areas than in rural areas. However, such studies are difficult to compare as countries use different ways of categorizing rural and urban areas. Objectives: We examine the association between disability measured through functional difficulties (seeing, hearing, walking, cognition, selfcare, communicating) and urban development measured through the satellite nightlight composite—an internationally comparable proxy for urban development. Methods: We use Demographic and Health Survey data for 15 low- and middle-income countries (LMICs) with the Washington Group Short Set of questions on disability. This study uses multilevel random intercept models to estimate whether functional difficulties are negatively associated with village-level nightlight composite. Results: While country level results vary, in the pooled sample, adults living in villages above the 80th percentile of nightlight activity have odds of reporting any functional difficulty that are 0.765 times those of adults in villages below the 80th percentile of nightlight (AOR = 0.765; 95 % CI = 0.717 to 0.816). The result is robust for each functional domain but the correlation is higher for hearing, cognition and communicating. Conclusions: In 15 LMICs, adults in rural areas are significantly more likely to have functional difficulties compared to adults in urban areas. Research is needed on the factors that drive such a correlation, including poorer living conditions and access to services in rural areas, differential access to resources and environmental barriers in rural and urban areas and potential differences in rural-urban migration opportunities across functional difficulty status.