This paper analyzes the impact of established Diaspora on the reduction of poverty, and identifies ways in which policy interventions, especially from donors of official development assistance, might strengthen that impact. The new policy interest in Diasporas reflects a broader concern with globalization, and specifically the very recent appreciation of the volume of remittances to developing countries by emigrant workers and their descendents. Remittances, however, are far from being the only vehicle for Diaspora influence on the incidence of poverty in their home countries. For many countries, the Diaspora are a major source of foreign direct investment (FDI), market development (including outsourcing of production), technology transfer, philanthropy, tourism, political contributions, and more intangible flows of knowledge, new attitudes, and cultural influence. The quality of information, much less hard data, about Diaspora influences in these dimensions is in general very poor, posing a serious challenge to policy development. This paper examines the role of Diaspora in poverty reduction through four main areas of focus, as requested by DFID focusing (1) Policy and practice towards Diaspora on the part of countries of origin. (2) Diaspora engagement in countries of origin (in the economic, social and political spheres), including the networks and infrastructure in which it is manifested. (3) Donor engagement with Diaspora and (4) Recommendations for future activity by DFID to maximize the contribution of Diaspora to development and poverty reduction.