Health literacy is often defined as the degree to which an individual has the capacity to obtain, communicate, process and understand basic health information and services to make appropriate health decisions. Research shows that 30 million Americans have Below Basic health literacy skills. People with low health literacy skills contribute to higher utilization of health care services. This equates to an excess of $230 billion a year in health care costs linked to low literacy in the United States. The primary responsibility for improving health literacy lies with public health professionals and the health care and public health systems. However, studies find that interventions using principles of health literacy, applied in community-based settings, can result in improved outcomes at the population level. In this article, the Health Literacy Action Team members consider the role of Extension in this important area, and suggest practices in incorporating health literacy into existing Extension programs and educational materials, and future resources for Extension and community partners.