Poverly aile vial ion is lop on Ihe agendas of 1170sl developing counlries 10 dignify Iheir citizens wilhrndecenlliving condilions. To Ihis end, Ihe development of Micro and Small Enlerprises (MSEs) has beenrnrecognized as an imporlant 1001 to creale employment opportunities for the poor thereby increase theirrnincome.rnThis study investigates the influence of group-based MSEs in allevialing urban poverty in NekemternCiIY, Oroll7iya Regional Stale. A sample was taken Fom 42 group-based micro and small enterprisesrnwhich have been regislered and supporled by the City Trade, [nduslly, and Tral15pOrl Department.rnEight group-based MSEs were selecled randomly by considering Iheir geographical dislribution andrnnature of aclivilies in Ihe city. Two MSEs which starled business afier Ihree monlhs were laken as arnconlrol against which 10 assess Ihe eJJecliveness of MSEs on poverty alleviation. Various povertyrnindicalors like, income, consumplion expendilure, housing, assel crealion, educalion, health, wa/er,rnvulnerability and empowerment of women entrepreneurs were assessed.rnThe study utilizes various slatistical lools like descriplive statistics, Chi-square tesls, T-tests, andrnANOVA tesls 10 reflect the true nalure of MSEs in alleviating poverty in the study area. The sludy alsornIries to examine the nature and struClure of group-based MSEs in Nekemle town so as 10 identify thernproblellls and opportunities Ihat exisllo supporlthe development of the enterprises.rnThe sludy findings are that group-based MSEs in the study area have got various Iypes support ji'Oll1rnIhe Nekemte City Municipality in Ihe area of access to start-up capital through credil, work premise,rnand lIIarket access. However, some group-based MSEs are can fran led with delays in Ihe paymenl forrnIheir produce, quality work and market premise, and inadequate services like waleI' and electricity.rnWhen il comes to the impact of group-based MSEs on alleviating poverty of operalors and theirrnhouseholds, the study finds that operators have showed improvement, in their income, consumplionrnexpendilure, and access 10 services like rented house, educalion, health, asset creal ion, avertingrnvulnerability, and empowerment of women entrepreneurs.rnThe study underscores the need for appropriale support 10 keep the suslainabilily of such MSEs givenrnIheir importance in improving living condilion of opera/aI's and slilllulaling Ihe local economy.rnKcy TCI-ms: urban poverty, Nekemte city, group-based MSEs.