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This article sets out to examine the extent to which the South African government's land reform programme might provide a way out of poverty for its beneficiaries. The research was undertaken with two previously marginalised rural communities situated in the Northern Cape province of South Africa that had recently been granted land through the restitution and redistribution components of the programme. The results emphasised the low asset status of most households and their striking dependence upon public transfers, in particular old age pensions and disability grants. For better-off households, it is participation in paid employment that enables them to avoid poverty. The research demonstrates unequivocally that restituting or redistributing land that is geographically remote from the residence location of the beneficiaries, and with no service or technical support to assist them with start-up agricultural activities, provides no effective solution to reducing poverty in rural South Africa. Considering the current failure of the land reform programme to meet its poverty reduction objectives, this article proposes that land should only be made available to poor people in smaller quantities and near their homes so that they can utilise it with minimal outside support.