Currently, in order to reform the Malaysian education system, there have been a number of education policy initiatives launched by the Malaysian Ministry of Education (MOE). All these initiatives have encouraged and inculcated teaching and learning for creativity, critical, innovative and higher-order thinking skills rather than conceptual knowledge, procedural knowledge, and rote memorization. The reform in teaching and learning approaches in Malaysian teacher education should also be reflected in the method of assessment as assessment is seen as a vital part of instruction in the culture of learning. In view of the need for changing school assessment culture, teachers' assessment literacy becomes one of the main concerns. Assessment literacy is regarded as the sound knowledge and skills in educational assessment required by teachers in assessing students' learning outcome. This article presents practical suggestions concerning knowledge and skill target of teachers' assessment literacy. Assessment literacy should not be fully addressed in theoretical fashion, but in a more practical and real-life manner. The five knowledge and skill targets that teachers should seriously focus on are: 1) validity of assessment, 2) reliability of assessment, 3) transparency of assessment, 4) fairness of assessment, and 5) using of assessment information.