http://devnet.kentico.com/docs/devguide/index.html?developing_form_controls.htm

Create a custom form control, maybe call it CountryState selector.

In your custom control, create a property that will allow you to tell it the name of the document field for the "State" value.

In your custom control, add both drop downs and the logic to select the country and states.

Override the GetOtherValues method of the custom control and have it return the value of the selected state for the field name set for "State"

In your custom document type that will use this control, add 2 fields, one for country, the other for state.

Choose your custom form control for the Country field and set the property for the State field name to whatever you call it in the custom document type.

Make the field for State not visible in the editing form. Also make sure that it is not set to be a required field.

Now when you select a country and state and save the document, the values from your custom form control will be saved in the country and state fields of your document.

Here is example code for the GetOtherValues method:

public override object[,] GetOtherValues()
    {
        if (!String.IsNullOrEmpty(StateFieldName))
        {
            object[,] result = new object[1, 2];
            result[0, 0] = StateFieldName;
            result[0, 1] = selectedStateName; //this is the variable that you will need to set to your selected state name.
            return result;
        }
        else
        {
            return base.GetOtherValues();
        }
    }