According to information issued at the World Food Summit held in Rome in 1996, about one fifth of the world's population is now living under the poverty line, and this number is increase by 25 million people in developing countries every year. For the purpose of maintaining social stability and sustainable economic development, poverty reduction and eradication have therefore become an historical mission of all developing countries, as well as of the international community. Through market-oriented economic reforms and rapid growth strategies, China has achieved tremendous success during the past 18 years in the reduction of rural poverty. The number of the rural poor declined from 250 million in 1978 to 65 million in 1995 (IRD, CASS and SSB 1996). However, some negative results have also emerged in the performance of poverty alleviation programmes in the ongoing transition of economic systems, and these have apparently retarded the overall progress. Thus, poverty alleviation strategies for the rest of the decade must be rethought, and assistance programmes for the poor must be modified. This paper offers an overview of the issues in rural poverty. The overview is based on existing data on poverty. The paper then examines two major poverty reduction programmes (a public works programme and a rural credit programme). Finally, possible methods to solve the problems encountered in the implementation of these programmes are outlined.