This paper examines the households' preferences for the public school, the private school and the no-schooling option in rural Uttar Pradesh and Bihar. The results reveal that the quality of the local public schools and the costs of attendance have distinct effects on the school choice in the two states. The maternal and paternal preferences over the three schooling choices are not aligned. The composition of the household assets and the occupational structure seem to have important implications for child labor and hence for the schooling choices even after controlling for household income. At the village level, the presence of private schools, access to electricity and a lower level of caste-homogeneity play a crucial role in effecting the schooling choices of the households.