This study explores the impact of Artificial Intelligence (AI) literacy on trust in AI across critical sectors, including transportation, healthcare, and social relationships. An online survey of 300 participants was conducted to examine trust levels in six practical AI application scenarios. The findings revealed that individuals with advanced AI literacy consistently demonstrate higher trust across all scenarios. In contrast, those with intermediate AI literacy exhibit more skepticism, particularly in high‐stakes contexts such as transportation and healthcare. This result indicates that the disparities in AI literacy can significantly shape trust levels, and the context of AI use matters. Therefore, targeted educational programs are needed to improve AI literacy, rectify misconceptions, and promote broader acceptance and trust in AI technologies. Further research should expand the demographic scope to further validate these findings and optimize educational initiatives for inclusive and equitable AI integration.