Universal health coverage (UHC) aims to provide essential health services and financial protection to all. This study aimed to assess the relationship between the service coverage aspect of UHC and poverty in low- and middle-income countries (LMIC). Using country-level data from 96 LMIC from 1990–2017, we employed fixed-effects and random-effects regressions to investigate the association of 8 service coverage indicators (inpatient admissions; antenatal care; skilled birth attendance; full immunization; cervical and breast cancer screening rates; diarrhoea and acute respiratory infection treatment rates) with poverty headcount ratios and gaps at the $1·90, $3·20, and $5·50 poverty lines. Missing data were imputed using within-country linear interpolation or extrapolation. One-unit increases in 7 service indicators (breast cancer screening being the only one with no significant associations) were associated with reduced poverty headcounts by 2·54, 2·46, and 1·81 percentage points (pp) at the $1·90, $3·20, and $5·50 lines, respectively. The corresponding reductions in poverty gaps were 0·99 ($1·90), 1·83 ($3·20), and 1·89 ($5·50) pp. Apart from cervical cancer screening, which was only significant in one poverty headcount model ($5·50 line), all other service indicators were significant in either the poverty headcount or gap models at both $1·90 and $3·20 poverty lines. In LMIC, higher service coverage rates are associated with lower incidence and intensity of poverty. Further research is warranted to identify the causal pathways and specific circumstances in which improved health services in LMIC might help to reduce poverty.