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Using data from the National Family and Health Survey, 1992-93 and 2005-06, this paper examines the linkages of poverty reduction and fertility change in Indian states. The official cutoff point of poverty is applied to the composite wealth index (based on economic proxies) in defining the poor. Fertility changes are measured with respect to changes in total fertility rate (TFR) and fertility preferences indicators. Results indicate that the level of fertility has declined both among the poor and non-poor in most of the states but in varying degrees. While the contribution of the poor to the decline in fertility was about 10 percent in the country, it was maximum in the states like Chhattisgarh (44 percent) followed by Madhya Pradesh (29 percent). The states of Bihar and Jharkhand showed little decline in the fertility level, though poverty had reduced substantially in these states. The decline in fertility level and preferences are largely reflected in contraceptive use and less in increase in age at marriage. The poor and non-poor differential in contraceptive use has narrowed down in many of the states. The study concludes that the association of decline in poverty and fertility is weak and the effect of space (region) is large in relation to the change in contraceptive use.