The promotion of urbanization in China is proposed to expand rural consumption demand as well as be an important breakthrough to increase domestic demand. This article empirically analyzes effects of urbanization, population structure, consumption structure upgrading on the rural consumption by using the provincial panel data of China over the period 2002—2012. The findings show that urbanization process is positively related to rural consumption with regional difference that there is greater impact of urbanization on rural consumption in the East than that in the West. Another finding is that there is significant single threshold effect of urbanization on rural consumption and the threshold estimation is 0.589. In the regions with high level of urbanization（＞0.589）, there is greater impact of urbanization on rural consumption, but majority of provinces in China haven’t reached the threshold value. This paper proposes that it is necessary to further accelerate the urbanization process in China especially in undeveloped regions like the central and western regions and to give full play of the urbanization to rural consumption.