The general objective of the study was to explain factors influencing fertility decline in urban areas while it has remained a constant and high in the rural areas of Uganda for over a half a century. Fertility in Uganda is quite high and on average it has been consistently above 6 children between 1948 and 2002 (UBOS, 2005). Uganda’s TFR of 6.9 is among the highest TFR in Africa and the world. To be more precise the 5th in Africa and the 6th in the world behind Niger (7.1), Guinea Bissau (7.1) Angola and Liberia (6.8) and East Timor (7.0) (World Population Chart, 2007). The current UDHS (2007) has put TFR at 6.7 (UBOS and Macro, 2007). Several surveys have established that fertility in urban areas is lower than the fertility in rural areas all over the world (World Fertility Survey 2005). For instance; Egypt’s TFR is 3.0 and 3.8 urban and rural areas respectively; Ethiopia 3.3 in urban and 6.4 in rural areas; similarly in Uganda it is 4.0 and 7.4 in urban and rural areas respectively. Decline in fertility is more noticeable in urban areas than in rural areas. Over the inter-survey period, fertility in urban areas decreased from 5.0 to 4.0 while that in the rural areas just increased from 7.1 to 7.4(UDHS 2001). Irrespective of a woman’s age, Total Fertility Rate (TFR) is lower in urban areas than in rural areas. This paper is re-analysis of the 1995 and 2001 Uganda demographic and health surveys. These were national surveys covering about ninety five percent of all the districts of Uganda except for a few in Western and Northern Uganda due to insecurity in these places at the time. The datasets used were from the woman questionnaire. A total of 2439 eligible females in 1995 and 2416 in 2001 were interviewed in urban areas of Uganda and they made up the sample for this study. The variables selected included: age structure, educational level, religion, occupation status, region, contraceptive use, breastfeeding, proportion married (Marital status) and age at first marriage. The Bongaarts and Porter (1983) aggregate model was used. This model was selected because it quantifies the contribution of each proximate determinant of fertility. Details of the model explained fully in the paper. It was possible to explain the factors that have lead to fertility decline in urban areas of Uganda between the two inter-survey periods using the Bongaarts and Porter (1983). The model established that the change in the proportion married and postpartum infecundability due to breastfeeding had the greatest inhibiting effect on fertility in urban areas of Uganda. Contraception use contributes the least. It was established that there were wide variations in the degree of influence of the socio-economic factors that operate through the proximate determinants in influencing fertility. The most influencing socio-economic variables are education, religion and occupation. It is recommended that promotion of contraceptive use, prolonged breastfeeding habits, female education hence employment and general reproductive health education are important if the fertility in Uganda is to decrease.