This report constitutes a step toward designing an integrated strategy for rural poverty reduction in Brazil. The report contains an updated and detailed profile of the rural poor in the northeast and southeast regions of Brazil; identifies key components of rural poverty in those regions; and proposes a five-pronged strategic framework in which to couch a set of integrated poverty-reduction strategies. The framework envisions five exit paths from poverty: agricultural intensification of the small-farm sector, a more dynamic commercial agricultural sector, stimulation of rural non-farm employment, migration of youth to urban areas, and safety net provisions for those "trapped" in poverty. Contributing to this framework are in-depth thematic studies of the small-farm sector, rural labor markets, rural land markets, rural non-farm employment, rural education, and rural pensions. The analysis of rural education focuses on grades 1-4, which contain 85 percent of rural enrollment, and presents detailed data for the 1990s on enrollment, grade promotion, scores on national standardized tests, teacher qualifications, schools' physical infrastructure, and access to computers and a library. Regional and rural-urban differences are highlighted. The main educational funding programs of the national Ministry of Education are described, as well as recent reforms that have shifted most education funding from pork-barrel politics to more equitable, formula-driven allocation methods. (Contains many data tables) (SV)