This important research is finalized on the impact of poverty alleviation in the area of Khairpur District. In this research the literature review is defined by many researchers. This research defines that how microfinance works for the betterment of poverty alleviation? Even that it faces many challenges of community, political and economic crises. The percentage of poor quality in Pakistan is increased due to inflation rate it increased now according to the core inflation was recorded at 5.9 percent.