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Abstract Phenotypic differences between urban and rural populations are well‐documented, but the evolutionary processes driving trait variation along urbanization gradients are often unclear. We combined spatial data on abundance, trait variation, and measurements of fitness to understand cline structure and test for natural selection on heritable coat color morphs (melanic, gray) of eastern gray squirrels (Sciurus carolinensis) along an urbanization gradient. Population surveys using remote cameras and visual counts at 76 sites along the urbanization gradient revealed a significant cline in melanism, decreasing from 48% in the city center to <5% in rural woodlands. Among 76 squirrels translocated to test for phenotypic selection, survival was lower for the melanic than gray morph in rural woodlands, whereas there was no difference in survival between color morphs in the city. These results suggest the urban–rural cline in melanism is explained by natural selection favoring the gray morph in rural woodlands combined with relaxed selection in the city. Our study illustrates how trait variation between urban and rural populations can emerge from selection primarily in rural populations rather than adaptation to novel features of the urban environment.