Poverty dynamics analysis provides useful insights into what determines movements in and out of poverty and why some households remain poor. The main purpose of this study is to investigate the dynamics of households' movements in and out of poverty in Egypt and to assess the main factors affecting these movements between 1998 and 2006. The study depends on 1998 and 2006 Egypt Labor Market Panel Surveys. The results of the paper show that there are 17.1% of individuals enter into poverty or exit from it (transiently poor) during the period (1998- 2006). There are 71% of individuals are never poor while 11.8% are chronically poor. The main factors affecting the dynamics of poverty are the education of household heads, regions, household size, average persons per room, owning household enterprise, household share of employed persons, and of government and public sectors, share of children and adults in the household.