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Fair trade certification is promoted as a market-based mechanism to improve the living conditions of smallholder farmers by ensuring fair prices, cooperative strengthening, and sustainable agricultural practices. This study evaluates the impact of fair trade certification on multidimensional poverty among coffee producers in Honduras—a country facing persistent rural poverty and agricultural vulnerability. Using a cross-sectional survey of 419 coffee farmers from 16 cooperatives (eight fair trade certified and eight non-certified), the study applies a Multidimensional Poverty Index (MPI) adapted to the Honduran context. A combination of descriptive statistics, Mann–Whitney U tests, and Chi-square analyses was employed to identify significant differences between certified and non-certified producers. Results indicate that certified producers exhibit significantly lower deprivations in education, health, employment, and housing. Participation in Fair Trade markets is associated with improved income stability, access to services, better living conditions, and lower incidence of child labor. These findings provide robust empirical evidence for inclusive trade policies, rural poverty reduction strategies, and sustainable agricultural development programs.