Rural entrepreneurship addresses issues such as job creation, income generation, rural growth, the establishment of village republics, and the reduction of rural-urban migration. India's Central and State Governments have implemented numerous policies and various schemes to encourage entrepreneurship in rural areas. However rural graduates hailing from the southern regions of Tamilnadu state did not have proper awareness and knowledge about their entrepreneurship opportunities. The circumstances of rural graduates are largely due to a lack of abilities and entrepreneurial understanding. This study tests awareness and challenges to adopting entrepreneurship among rural graduates. The study employed a quantitative survey research method. A proportionate multi-stage sampling with a simple random and purposive sampling technique was applied to choose rural graduates from South Tamil Nadu. A sample of 457 rural graduates from three districts in South Tamil Nadu was selected to test the study hypotheses with factor and multinomial regression analysis. The result shows a medium and low level of entrepreneurship awareness among rural graduates. They have faced the following challenges in adopting entrepreneurship: financial support, entrepreneurship education & training, cultural & social norms, and physical infrastructure.