India has recently been witnessing a growing incidence of urban poverty. The forces of liberalization and globalization have accelerated the pace of economic growth coupled with exclusionary process of urbanisation and resultant increase in the absolute number of urban poor. The urban poverty is a complex and multi-dimensional phenomenon. It is not just lack of income to buy minimum amount of food calories, it rather reflects inadequate provision of education, sanitation, housing, water supply and health care facilities to be delivered by the urban management system. The purpose of the study is to discuss the latest trends, nature and constitution of urban poverty. The study also highlights the severity and magnitude of the urban poverty and analyses the causes of its rise at alarming proportions. Conclusions drawn underscore important policy implications to tackle the challenges of urban poverty in the midst of rapid urbanization.