The aim of this study helps to understand the successful path of micro-financing, which can plays a vital role in poverty alleviation in Pakistan. The purpose of current research is to identify the effect of microfinance on eradication of poverty in the area of Khairpur District. In my research the microfinance is independent variable whereas the income, health, education and living standard of people are dependent variable. In this research the sample size of population is 300. Most of barrower was satisfy from the microfinance that helps the poor to remove the poverty and encourage them towards the business so that they may be self-confidence, and may start their own business, and earn profit, build the living standard of life. Instead of regrets on their lives, and pass the worst life. So in this research the study applied is the statistical method in the shape of table and graph.