Purpose To examine the difference between rural and urban hospitals as to their overall level of readiness for stage 2 meaningful use of electronic health records (EHRs) and to identify other key factors that affect their readiness for stage 2 meaningful use. Methods A conceptual framework based on the theory of organizational readiness for change was used in a cross‐sectional multivariate analysis using 2,083 samples drawn from the HIMSS Analytics survey conducted with US hospitals in 2013. Findings Rural hospitals were less likely to be ready for stage 2 meaningful use compared to urban hospitals in the United States (OR = 0.49) in our final model. Hospitals’ past experience with an information exchange initiative, staff size in the information system department, and the Chief Information Officer (CIO)’s responsibility for health information management were identified as the most critical organizational contextual factors that were associated with hospitals’ readiness for stage 2. Rural hospitals lag behind urban hospitals in EHR adoption, which will hinder the interoperability of EHRs among providers across the nation. The identification of critical factors that relate to the adoption of EHR systems provides insights into possible organizational change efforts that can help hospitals to succeed in attaining meaningful use requirements. Conclusion Rural hospitals have increasingly limited resources, which have resulted in a struggle for these facilities to attain meaningful use. Given increasing closures among rural hospitals, it is all the more important that EHR development focus on advancing rural hospital quality of care and linkages with patients and other organizations supporting the care of their patients.