This book explores the concept of artificial intelligence (AI) literacy within higher education, addressing both instructors' and students' preparedness to engage with AI technologies responsibly and effectively. By synthesising existing frameworks and empirical studies, alongside presenting two original research studies, the book bridges theoretical foundations with practical applications tailored for modern educational contexts. Practical recommendations include methods to develop AI literacy skills, focusing on ethical awareness, technological competence, and the potential for AI to enhance teaching and learning processes. Aimed at higher education instructors, stakeholders and students, the book offers actionable insights and tools for fostering informed and critical engagement with AI, aligned with lifelong learning goals and professional development needs.