The objective of this study was to obtain an understanding of local views on the characteristics of poor and wealthy households, as perceived by the rural residents. The study was conducted in Magobbo area which is located in Mazabuka District in Zambia’s Southern Province. Qualitative research methods and techniques, including Participatory Wealth Ranking (PWR) exercises were used to generate information on the traits, characteristics and visible signs by which poverty is recognized by people in the area. The results show that the rural residents were clearly able to identify several characteristics or themes to describe the poverty or wealth status of households in Magobbo. Livelihood activities or employment status was identified by the residents as one of the main characteristic in describing the relative poverty or wealth status of households. The physical assets owned; land ownership or tenure; housing conditions; food security; schooling of children; and alternative income generation activities such as begging, and getting remittances from relatives were also identified. A variety of other non-income characteristics were also identified such as the gender dimension of poverty, as well as the health and nutrition status of the households. These findings show that PWR exercises are useful in capturing local knowledge about poverty and in identifying or defining who the poorest are in rural areas. Such information is important in making decisions related to identifying, targeting, planning and prioritizing of interventions for addressing the development challenges of the poor and vulnerable.