Using the claims data of one million insured residents in Taiwan from 1996–2013, this study identified 12,126 women in an urban city (Taichung) and 7229 women in a rural county (Yunlin), aged 20 and above. We compared Papanicolaou (Pap) test uses and cervical cancer detection rates between urban and rural women. Results showed that the Pap screening rate was slightly higher in rural women than in urban women (86.1 vs. 81.3 percent). The cervical cancer incidence was much greater for women without Pap test than women with the test (35.8 vs. 9.00 per 1000 in rural women and 20.3 vs. 7.00 per 1000 in urban women). Nested case-control analysis showed that Pap test receivers had an adjusted odds ratio (OR) of 0.35 (95% CI = 0.25–0.51) to be diagnosed with cervical cancer as compared to those who did not receive the test. The rural women had an adjusted OR of 1.46 (95% CI = 1.03–2.06) to be diagnosed with cervical cancer as compared to urban women. In conclusion, women in rural area are at higher cancer risk than city women. Women who do not undergo Pap tests deserve timely intervention of Pap test to prevent the onset of cancer, particularly in rural women with low income.