Abstract A range of factors from socio-economic to socio demographic factors determine membership of household heads participation to iddirs Gende Wain town. In addition to this, there is a gap of using iddirs in developmental activities and such institution contribute little role in poverty reduction and priorities are given to formal institutions. This study assesses the role of community based iddirs in poverty reduction in Gende Wain town Goncha Siso Enesie woreda as the case study. Primary data sources were used to collect data from key informants interview, focused group discussion and survey questionnaires. The collected data from key informants interview, focused group discussion and survey questionnaires were analyzed using qualitative and quantitative seseorch methods. Major finding revealed that, majority of sampled respondents were members of iddirs. From the total participants of survey questionnaires 7 4 % were male headed households. The study also found out that, the majority of household heads perceived iddirs as insurance mechanism. The study also found out that, the potential of iddirs to reduce poverty is remained unutilized. The formal institutions and government of Ethiopia does not cooperate with iddirs and give little attention. The study also investigated the major problems of iddirs as financial constraints, lack of initiation from members and embezzlement of their finance by different bodies. •the study area some iddirs are tried to cease harmful traditional practices but some members are 1'fll applying that traditions. The perception of household heads to use iddirs in developmental activity is very little; they mainly used iddirs for funeral services. In order to use iddirs in poverty reduction, there should be a shift in government views on community involvement through iddirs and the government should assist iddirs financial problem. In addition to this, other development actors such as NGos and formal institutions have to work with them to reduce poverty and to bring development. Key Terms: iddir, Household, Mernbersbip of iddirs, Gende Woin, Goncha Siso