Functional adult literacy interventions have been regarded for many decades by policy makers as an effective way of imparting health knowledge. Supported by research on the statistical relationships between women's literacy rates and health indicators, this dominant policy discourse is based on assumptions that non-literate women lack understanding and confidence, and that formal programmes and institutions constitute the main sites of learning. Proposing a broader conceptualisation of literacy as a social practice and of health as connected with social justice, this article draws on policy analysis and the authors' earlier research in Nepal to re-examine the relationship between gender, literacy and health. By comparing health and literacy approaches used within the education and health sectors and taking account of new and indigenous informal learning practices, the article points to ways of investigating the complex interaction of factors that influence inequalities in gender and health at community level.