HIV/AIDS has remained a challenge in Uganda among adolescent despite the ABC strategy used globally to prevent HIV infection. The study assessed the knowledge, attitudes and perceptions of secondary school teenagers towards HIV transmission and prevention in rural and urban schools of central Uganda. A cross sectional study using self-administered questionnaires and structured interviews was used to collect data from adolescents in secondary schools in Kampala and Buikwe districts. Eight schools were randomly selected with 4 schools in each district. A total of 245 students from schools were recruited in the study with 120 and 125 students from urban Kampala and rural Buikwe district schools respectively. Data were analyzed using SPSS version 11. The results were expressed as percentages in a 2 × 2 tables. The mean age of the participants was 15.9 ± 2.5 years. Results showed that 95.1% participants had knowledge on HIV/AIDS in both urban and rural schools and 27.4% knew all the modes of HIV transmission. About 83.7% knew the ABC strategy for HIV prevention and 37.6% would talk about HIV/AIDS mainly with friends. For HIV cure, 62.0% of study participants reported non-cure and 24.9% were not sure. The remaining 13.1% of the study participants in both urban and rural schools reported that HIV can be cured. And the modes of curing HIV that were mentioned by participants included spiritual healing, transmitting it to others through sexual intercourse and that antiretroviral (ARVs) drugs can cure it as well as that it can be cured abroad. About 65.7% of participants reported recognition of one with HIV/ AIDS and by having red lips, being sickly; weight loss, skin rash and being very rich were mentioned. About 39.2% of the study participants mentioned that they cannot get infected with HIV and can’t contract HIV at all and 18.4% believed that chances of getting HIV infection were high. On perception and attitude on condoms and their use, participants reported that it is a sign of mistrust, reduces sexual pleasures and they are embarrassing to buy. Majority of the participants in both urban and rural schools had some knowledge on HIV/AIDS and the ABC strategy for HIV prevention. However, there was a knowledge gap on the various modes of HIV transmission and prevention. There was misconception of the participants on HIV/AIDS cure, condom use and on the chances of contracting HIV. About the source of HIV/AIDS information, majority of the participants were getting information on HIV/AIDS from friends of which some information was misleading. This false information could be the reason for the increased HIV prevalence reported among the adolescents in the schools. Generally, participants had some knowledge on HIV/AIDS though they had knowledge gap on HIV transmission and prevention.