Poverty is widespread in Pakistan and the two main reasons are bad governance and income inequality. Few studies have focused on the theoretical substantiation of the impact of bad governance and income inequality on poverty, but we do not find any study that conducts empirical work on the impact of bad governance on poverty in Pakistan. This study is an empirical research that attempts to find out the long-term and short-term impact of poor governance and inequality in wealth and income distribution on poverty in Pakistan through time series analysis from the year 1984 to 2008. Approach ARDL (Autoregressive Distributive Lag) Co integration is applied to find out the short-run and long-run relationship between the variables. In the present study we find the cointegration between poverty, poor governance and income inequality. The results of this study also confirm the positive relationship between poverty and income inequality in both the short and long term. Poor governance is found to positively impact poverty in the long run, but in the short run it does not have a significant impact on poverty in Pakistan. CUSUM and CUSUMQ stability tests are used on the model and the results show that there is a stable relationship between the variables indicating the stability of the estimated model. Keywords: Poverty, Poor Governance, Income Inequality, ARDLO On 17 June 2010 three men committed suicide in Rajana, Lahore and Ghakhar Mandi due to poverty. As reported by the police, Nadeem, a 28-year-old man, took his life in Lahore for not repaying a debt of Rs. 800,000. In the next incident, Ismail, a 22-year-old man, killed himself by consuming poisonous pills due to poverty, in Rajana Tehsil. In the third accident in Gha......middle of paper......esh”. Working document no. 143. OECD Development Center Research Program on: Good Governance and Poverty Reduction. Sumarto, S., A. Suryahadi, and A. Arifianto (2004), “Governance and Poverty Reduction: Evidence from Newly Decentralized Indonesia.” An article from the SMERU Research Institute.The News International. Retrieved June 18, 2010, from http://beta.thenews.com.pk/TodaysPrintDetail.aspx?ID=29537&Cat=13&dt=6/18/2010The QoG Social Policy Dataset Codebook. Retrieved from http://www.qog .pol.gu.se/data/QoG_Codebook_vJune09.pdfVan der Hoeven, R. (2000), “Poverty and structural adjustment: some observations on trade-offs between equity and growth.” Employment Paper 2000/4.Geneva: ILOWorld Bank Publications (2002) Poverty in Pakistan: Vulnerability, Social Gaps and Rural Dynamics. Washington, DC.World Bank (2005) Update on poverty in Pakistan, 2005. Washington, DC.