The paper assesses the performance of Indonesia on poverty reduction and income inequality mitigation during successive post Suharto reformation era regimes. Findings indicate that Suharto’s regime bequeathed to reformation era governments stunning achievements with respect to poverty reduction and income inequality performance. Nonetheless, the fundamental change in political system from decree style to democracy, created an unstable and uncertain social, economic, and political environment which has in part reduced the pace of poverty reduction and income inequality mitigation. The country has had to undergo a new learning curve in building democratic institutions, which efforts were thwarted and suppressed during the entirety of 32 year Suharto’s regime. Thus, it is not surpassing that the advent of reformation era on the Indonesian political landscape, amid worsening global and domestic economic conditions initially led to a decline in poverty reduction and with time, an increase in income inequality. Improvements in public participation, representation, vibrant civil society, decentralized administration of key service delivery to districts and provinces, contributed to an increase in responsiveness and accountability of public officials to citizenry. That said, post Suharto regimes have been characterized by slow economic growth (which in large part is attributable to external factors, hence beyond control), putting interests of political parties ahead of public interests, and successive governments that have been based alliances of convenience. Rising public participation has not been translated into better (quality) representation, with political parties determining the form, composition, and direction of public policy often with little cognizance of problems that society faces. Consequently, government effectiveness, has tended to decline, as is regulatory quality, rule of law, and control of corruption. Even more disconcerting is the drop in the performance of five of the six good governance indicators in 2015. Protracted period of anemic economic growth, compounded by frequent change of governments , which in Indonesia’s context has largely signaled a dramatic shift in policy priorities; compounded by misguided policy priorities in education and human resource development, low financial inclusion, existing disparity in development between Western and Eastern Indonesia, limited fiscal space, and inability to create sufficient incentives for private investors to provide needed funding for much needed infrastructure revitalization, expansion and development, are some of the major challenges Indonesia still faces, and will continue to face, if it’s serious in its efforts to reduce poverty incidence and mitigate income inequality in future. The increase in income inequality in general and in urban areas in particular, which Indonesian has experienced over the recent past, may in part be attributable to increasing inelasticity of poverty reduction and income distribution to economic growth, albeit falling poverty incidence in general. What cannot be overstated, however, is the influence that the nature, form, composition and level of advancement of institutions a country has in place on quality of economic growth policies in general, and extent to which such policies reflect and impact, on poverty incidence and income inequality, in particular. The lower poverty reduction and income inequality achievements during post Suharto governments may perhaps be the price Indonesians have to pay to support an evolving institutional environment that that will bear munificent fruits in future. Some of the policies recommended to reduce the income divide at individual, social economic status, and regional level, include but not limited to tackling root causes of the persisting income divide through strengthening pro poor development policies (government programs that support not only price stability but more importantly income stability of farmers who produce all Indonesia’s key food crops not only rice and prices of smallholders’ cash crops in the estates sector; do something about the role that various tiers of middlemen play in the link between production and consumption (most policies that support stable incomes only benefit middlemen who sale farmer’s produce to processors or consumers for instance); implement programs that protect micro, small and medium size enterprises from unfair competition from large retailers and imported goods; promote organizing capacity of micro, small and medium sized players to reap benefits of economies of scale, financing efficiencies, low transaction cost, and high bargaining power; strengthen knowledge and information capacity of SMEs about prevailing prices, modern agronomy, firm management practices by linking them to relevant institutions that produce and have access to such knowledge and information (institutions of advanced education, research centers, private companies both local and foreign); reduce infrastructural rigidities by implementing US$130 Billion infrastructure development program, which is a key pledge of Jokowi Kallah administration. Investing in education at all levels in both the medium term and long term, promises the largest benefits as it is the only way Indonesia can enhance its absorptive capacity to rise up the value chain of all products and services the country produces and delivers , and trades with other nations, in ASEAN , APEC, and other parts of the globe. Not least important, however, is the need to deepen, widen and strengthen the ongoing anti-corruption drive