This study of agricultural labour households in central Punjab examines the extent of poverty and identifies its determinants. Data were collected from 120 households of two districts in central Punjab. The poverty gap index, 0.036%, shows the gap between the poverty line and the income levels of agricultural labour households. The squared poverty gap, 0.0048%, shows the severity of their poverty. To enhance the income and surplus levels of this vulnerable category, awareness should be generated about small family size, creating non-farm employment opportunities and rationalizing household expenditure, especially on non-food items.