In this paper we compare and contrast the view on poverty of lay people, who are affected by the policies, with that of academics and policymakers. Drawing from fieldwork in a village in Kerala, India, and applying the ‘participatory numbers’ approach, we devise a ‘local method’ to identify poor households, based on the villagers’ poverty criteria. The local method is then compared with the official methods used by the national and the state governments. Based on the results, we argue for the need to take into account local dimensions of poverty, in addition to objective/universal dimensions, in the design of poverty reduction programmes. Our findings also suggest that effective risk-mitigation strategies must be devised to help poor households cope with shocks and stresses as well as to prevent the vulnerable non-poor from falling into poverty.