Poverty analysis helps to focus the attention of government and civil society on the poor and the living conditions in which they live. Poverty and, as the central theme of this article, is one of the biggest and most visible problems of every transition society including Serbia. The text of this analysis is organized as follows. In the first part, the conceptual and theoretical definition of poverty is briefly presented. The second part gives a description of the cause of poverty and points to its complexity. The third part presents a cognition of the distribution, depth and nature of poverty and inequality of income in Serbian society, while the fourth part, as the last section, offers a proposal for measures for suppression of poverty. The method of the case-study was used in this paper, in order to better examine the nature and depth of poverty in the Republic of Serbia on the basis of relevant research.