Newcastle Disease Virus (NDV) is a virulent poultry pathogen with global circulation. Several vaccines reduce individual disease burden, including the attenuated, thermotolerant, avirulent, live-virus I-2 vaccine, but estimates of the population-scale impact of such vaccines in natural transmission settings are still lacking. Here, we leverage a unique 8 year data-set of poultry mortality from village settings in Madagascar, spanning pre-vaccination and vaccination periods, and fit a compartmental transmission model to characterize transmission and impact of vaccination. Pre-vaccination, the basic reproduction number, or number of new infections per infected individual in a completely susceptible population, is estimated to be R0=1.41 [SD=0.45] and mean Herd Immunity Threshold (HIT) for local elimination is estimated to be η=25% [SD=17%]. We estimate that the protective vaccine effectiveness of the I-2 vaccine to prevent viral shedding in village conditions was 83% (95% CI [28%, 95%]), and estimate that 90 infections of Newcastle disease virus were averted per month (60% reduction compared to baseline) due to the vaccination campaign. We also report descriptive statistics on the ownership and epidemiology of backyard poultry populations. Our results provide a foundation to delineate prospects of vaccination campaigns for local elimination to promote nutritional and economic sustainability in smallholder poultry farms.