Background: Maternal Health Literacy (MHL) is defined as a woman's cognitive and social abilities and motivation to access, assess, understand and use basic health information and services to make informed decisions that protect and promote their own and their children's health. Pregnant women's HL will enhance the effectiveness and long-term viability of those services by allowing them to get health-related knowledge and behaviours during this critical period. As a result, this study aimed at assessing the level of health literacy and associated factors among pregnant women in Southern Ethiopia, 2021.Methods: A facility-based cross-sectional study was conducted among 635 pregnant women attending ANC units of selected health facilities from January 1 to February 30, 2021, by using pre-tested, interviewer-administered questionnaires. A multistage sampling technique was employed and study participants were selected by using a systematic random sampling technique. Data were entered into EpiData3.1 and exported to SPSS version 23 for analysis. A bivariable statistical analysis was performed through analysis of variance (ANOVA) and independent t-tests and variables with a p-value of < 0.05 were eligible for the multiple linear regression model. To see the weight of each explanatory variable on MHL, multiple linear regression was employed, and the strength and direction of the association were reported by using a regression coefficient (β) with the respected 95% confidence interval.Results: The mean health literacy score of study participants was 23.85¹2.87 in which, more than half, 336 (53.5%)( 95%CI: 49.1, 58.1) of the study participants had a good MHL level or above the mean score. The multiple linear regression analysis results revealed a significant relationship between MHL and educational level (β: 1.358; p<0.001), gravidity(β: 1.439; p<0.001), ANC visits (β: 1.418; p <0.001), enrolment in CBHI scheme (β: 2.282; p<0.001) and being a model household(MMH) (β: 1.681; p<0.001).Conclusion and recommendation: The pregnant women in the current study area had a low level of maternal health literacy. Local governments should focus their efforts on establishing adult literacy centers in their respective locations. Pregnant women should be encouraged to attend adequate ANC visits, as per health care providers. Finally, at the community level, administrative bodies and health professionals should work on developing a model household and enrolling unenrolled households in the CBHI scheme.