Identify user's location [ Region/Sub Region ] based on IP address

There are some gems/plugins available
1. Geokit https://github.com/jlecour/geokit-rails3
2. Geoip https://github.com/mtodd/geoip
3. Geomagic https://github.com/kristianmandrup/geo_magic
4. Geo Location https://github.com/chrisyour/geo_location

 Your current best bet is probably GeoKit (http://github.com/andre/geokit-gem for gem, http://github.com/andre/geokit-rails for plugin). It has built in functionality for Yahoo and Google API keys, distance calculation helpers, reverse geolocation, etc.  Also Can find basic information of an IP like street_address, city, state,  zip etc. (As needed)
Please find details here http://geokit.rubyforge.org/api/geokit-gem/Geokit/GeoLoc.html