Background: Colorectal carcinoma is the third most common cause of death in Iran. This study was performed in order to determine the appropriate distal clearance margin (DCM) for resection of rectal cancer in patients who undergo neoadjuvant chemoradiotherapy for sphincter preserving procedure. Materials and Methods: This was a cross-sectional study conducted in Shahid Faghihi Hospital of Shiraz University of Medical Sciences from 2006 to 2011. We included all patients with low rectal cancer who underwent neoadjuvant chemoradiotherapy. The medical charts of patientsand disease characteristics were recorded. The local recurrence, recurrence-free survival and mortality rates were compared between those with DCM ≥2cm and DCM <2cm. Results: Overall, 82 patients with a mean age of 56.7 ± 16.4 years were included. The DCM was found to be ≥2cm in 45 (54.9%) patients and <2cm in 37 (45.1%). The two study groups were comparable in terms of age (p=0.573), sex (p=0.505), histopathological tumor grade (p=0.165), and distance of tumor to anal verge (p=0.125). Patients with DCM ≥2cm had a lower local recurrence rate (35.6% vs. 97.3%; p<0.001), a higher recurrence-free survival rate (88.9% vs. 67.6%; p=0.032) and a lower mortality rate (11.1% vs. 32.4%; p=0.027). Conclusion: Although some studies have showed that DCM<2cm leads to similar results compared to DCM≥ 2cm, our findings revealed that obtaining a distal clearance margin of 2cm for resection of rectal cancer in patients who have undergone neo-adjuvant chemoradiotherapy is associated with a lower local recurrence rate, higher recurrence-free survival rate and lower mortality rate.