Heart failure (HF) patients with inadequate health literacy are at increased risk for poor self-care and negative health outcomes such as hospital readmission. The purpose of the present study was to examine the prevalence of inadequate health literacy, the reliability of the Dutch HF Knowledge Scale (DHFKS) and the Self-care of Heart Failure Index (SCHFI), and the differences in HF knowledge, HF self-care, and 30-day readmission rate by health literacy level among patients hospitalized with HF. The convenience sample included adults (n = 95) admitted to a large, urban, teaching hospital whose primary diagnosis was HF. Measures included the Short Test of Functional Health Literacy in Adults, the DHFKS, the SCHFI, and readmission at 30 days after discharge. The sample was 59 ± 14 years in age, 51% male, and 67% African American; 35% had less than a high school education, 35% were employed, 73% lived with someone who helps with their HF care, and 16% were readmitted within 30 days of index admission. Health literacy was inadequate for 42%, marginal for 19%, and adequate for 39%. Reliability of the DHFKS and SCHFI scales was comparable to prior reports. Mean knowledge score was 11.43 ± 2.26; SCHFI subscale scores were 56.82 ± 17.12 for maintenance, 63.64 ± 18.29 for management, and 65.02 ± 16.34 for confidence. Those with adequate health literacy were younger and had higher education level, HF knowledge scores, and HF self-care confidence compared with those with marginal or inadequate health literacy. Self-care maintenance and management scores and 30-day readmission rate did not differ by health literacy level. These findings demonstrate the high prevalence of inadequate and marginal health literacy and that health literacy is an important consideration in promoting HF knowledge and confidence in self-care behaviors, particularly among older adults and those with less than a high school education.