Matrix solution 1

clear A
for i = 1:N,
  for j = 1:N,
    A(i,j) = abs(i-j);
  end
end

It is a good idea to clear the value of A before you start.  Alternatively, you can do it this way:

A = zeros(N,N);
for i = 1:N,
  for j = 1:N,
    A(i,j) = abs(i-j);
  end
end