Humans multitudinously interact with Artificial Intelligence (AI) as it permeates every aspect of contemporary professional and private life. The socio-technical competencies of humans, i.e., their AI literacy, shape human-AI interactions. While academia does explore AI literacy measurement, current literature exclusively approaches the topic from a subjective perspective. This study draws on a well-established scale development procedure employing ten expert interviews, two card-sorting rounds, and a between-subject comparison study with 88 participants in two groups to define, conceptualize, and empirically validate an objective measurement instrument for AI literacy. With 16 items, our developed instrument discriminates between an AI-literate test and a control group. Furthermore, the structure of our instrument allows us to distinctly assess AI literacy aspects. We contribute to IS education research by providing a new instrument and conceptualizing AI literacy, incorporating critical themes from the literature. Practitioners may employ our instrument to assess AI literacy in their organizations
