BACKGROUND:Rural hospitals in Australia, as in many countries, face challenges in ensuring that appropriate, quality services are provided. AIMS:The overall aim of this study was to explore the issues that impact on the ability of rural hospitals to provide effective health care. METHODS:We used a qualitative descriptive method and purposive sampling, and conducted interviews in hospitals in rural Victoria, Australia. The data collected enabled major issues that impact on hospital service delivery to be identified. Using thematic analysis, global themes were extracted and organized around a thematic network. FINDINGS:The workforce was an important theme. Whilst the impact of medical shortages on hospital function has been considered in other studies, little consideration has been given to the rural nursing workforce. The need to maintain an appropriately educated rural nursing workforce emerged as one of the major issues that impact on rural hospital service delivery. In Australia, there has been a great deal of discussion about the educational preparation required for rural nursing practice, with the emphasis on postgraduate study. However, the majority of rural nurses do not have postgraduate qualifications and face significant barriers in obtaining them. Although the vast majority of literature claims that postgraduate preparation is vital for rural nursing practice, this research suggests that the future rural nursing workforce will be recruited from undergraduate courses in regional universities. However, there is a need to include specific theoretical and operational preparation in undergraduate education, to enable nurses to make the transition to rural practice more readily. CONCLUSIONS:Rural nurses are central to the delivery of health services in rural hospitals. Future rural nursing recruitment and retention hinges on ensuring that they have the confidence, knowledge and skills to deliver safe, appropriate and effective care.