This is a report on a DFID Funded Action Aid Research Project on Methods and Indicators for Measuring the Impact of Poverty Reduction. The aim of the research was to use Action Aid’s direct contact with a wide range of poor communities and local organizations, to research different methods for the assessment of impact, and to identify more locally relevant indicators of change. The first part of the paper explores the concept of impact assessment, reviews both why, and for whose benefit it should be undertaken, and proposes ways in which the extent of people’s participation in impact assessment can be assessed. The paper also reviews the background, methodology, and key findings of the research in the four countries of Bangladesh, India, Ghana and Uganda. Major findings of the research include the need for field workers to be more selective in their use of participatory techniques, the importance of tracking long-term changes in peoples, key indicators and the need for NGO,s to support an ,impact assessment culture, in all that they do and the systems that they follow.