The relationship between poor literacy skills and health status is now well recognized and better understood. Interest in this relationship has led to the emergence of the concept of health literacy. The concept has emerged from two different roots - in clinical care and in public health. This paper describes the two distinctive concepts that reflect health literacy, respectively, as a clinical "risk", or a personal "asset". In the former case a strong science is developing to support screening for poor literacy skills in clinical care and this is leading to a range of changes to clinical practice and organization. The conceptualization of health literacy as an asset has its roots in educational research into literacy, concepts of adult learning, and health promotion. The science to support this conceptualization is less well developed and is focused on the development of skills and capacities intended to enable people to exert greater control over their health and the factors that shape health. The paper concludes that both conceptualizations are important and are helping to stimulate a more sophisticated understanding of the process of health communication in both clinical and community settings, as well as highlighting factors impacting on its effectiveness. These include more personal forms of communication and community based educational outreach. It recommends improved interaction between researchers working within the two health literacy perspectives, and further research on the measurement of health literacy. The paper also emphasizes the importance of more general strategies to promote literacy, numeracy and language skills in populations.