There is increasing appreciation that group memberships can have both beneficial and damaging impacts on health. In collaboration with Nepal Leprosy Trust (NLT), this longitudinal study explores a group-based approach to stigma reduction among people affected by leprosy in rural Nepal (N = 71)—a hard to reach and underrepresented non-WEIRD population. Informed by the ‘social cure’ literature, and the progressive model of self-stigma, we use a longitudinal design. We found that a sense of belonging to a self-help group can facilitate education in terms of health literacy, and over time these two factors also have impacts on participants stigma. Specifically, self-help group belonging predicted improvements in health literacy, leading to reduced endorsement of negative stereotypes and thus less stigma-related harm among people affected by leprosy. The study offers promising evidence that group-based interventions, which support health education, can reduce the harmful impact of stigma in very challenging contexts.