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Poverty, one of the world’s most serious problems, is particularly severe in Africa. Eritrea is a 16-year old nation that gained its independence from Ethiopia in 1993. The country’s economy was doing relatively well between 1993 and 1997. Eritrea was then exposed to numerous challenges such as drought, famines and recurrent war. As a result, poverty has become more rampant in a country where over 66 per cent of people live below the poverty line. Some families live on remittances. The government has taken some poverty alleviation measures. However, it has not mitigated poverty due to a lack of resources and a poorly implemented poverty alleviation programme. This article attempts to explore the incidence of poverty. It also provides details of poverty surveys that have been conducted since independence. It discusses various poverty challenges and provides some policy implications for development. [ABSTRACT FROM AUTHOR]