Carcinoma involving the lower part of the rectum is now successfully managed by sphincter saving surgery with less morbidity and uneventful recovery. This study was designed to observe the sexual and urinary dysfunction in both sexes of the patients suffering from cancer of the lower third of the rectum managed by surgical intervention with preservation of sphincter. A comparative study was carried out on 54 patients with low rectal cancer who underwent ultra-low anterior resection in the department of surgery, Bangabandhu Sheikh Mujib Medical University, Dhaka from January, 2009 to December, 2010. Patients were divided into two groups depending on the tumor distance from anal verge. Thirty one (57%) patients were in Group A (Experimental) where tumor distance was 5cm from anal verge and upper 1cm of anal sphincter was sacrificed during surgical intervention. Twenty three (43%) patients were in Group B (Control) where tumor distance was 6cm from anal verge and whole length (4cm) of anal sphincter was preserved during surgical intervention. The mean±SD age of the patients was 45.96±14.41 years. During surgery, ultra low anterior resection was performed to remove the tumor in all patients and for anastomosis double stapling technique was performed in 52(96%) patients and hand sewn technique was performed in 2(4%) patients irrespective of tumor distance from anal verge. Covering ileostomy was fashioned in all but one patient. During post-operative follow up Sexual activity in both groups of male patients (Potency, P=0.17; ejaculation; satisfaction and loss of libido, P=0.15) and in female patients (Satisfaction and loss of libido, P=0.15) was not significantly hampered following surgery. Urinary function was assessed by incontinence, increased frequency (P=0.54) and retention (n=0) which were not impaired significantly following surgery. Sexual and urinary function was not significantly impaired in both sexes after low rectal cancer surgery. Sphincter saving surgery can be performed in a very low rectal cancer with preservation of anal sphincter.