The establishment of MSMEs and success of entrepreneurs are extremely important and inevitable for developing countries like India, as they are significant contributors to economic growth and employment creation. Hence it would be of paramount importance to understand the motivational factors of entrepreneurs, as any insights on such factors will help the policymakers and authorities to make effective decisions for growth and development of the nation. The purpose of our study is twofold. First, it seeks to examine if there exists any difference among the motivation factors of the entrepreneurs in the MSME sector in urban and rural regions. The study also seeks to investigate the extent to which the selected eight factors motivate entrepreneurs to start the business. A total of 116 entrepreneurs in the MSME sector in Kerala were selected using judgment sampling. The data were analyzed using SPSS 23.0 for Windows. Descriptive statistics were used to describe and summarize the properties of data collected from the respondents. A Parametric statistics z-test was conducted to analyze any differences in motivation factors in urban and rural regions. Levels of 0.05 were established as priori for determining statistical significance. When asked to indicate their motives for business ownership, entrepreneurs suggested that to increase the income and to prove they can do it, and becoming their own boss were the most important reasons. Policymakers can motivate entrepreneurs by promoting the factors that lead to entrepreneurs to start business.