Climate change and poverty mostly fall into the adaptation category in the current research literature and relevant policy making due to the assumption that poor countries produce only low carbon emissions. However, this paper argues that current findings in poverty research show that the separation between mitigation and adaption is no longer accurate, because the majority of the world’s poor now live in middle-income countries. According to the paper, climate change presents a threefold policy challenge for these countries: their mitigation actions need to also contribute to poverty alleviation; emissions reduction must not compromise the competiveness of their economies; and they need to prepare to adapt to unavoidable consequences of climate change. The paper notes that mitigation actions can have both positive and negative poverty effects; their impacts depend on an adequate pro-poor policy mix.