Physical literacy has emerged as a unifying framework across health, education, and sport to support lifelong participation in physical activity. While definitions vary, most center the development and integration of competencies across physical (e.g., movement skills), cognitive (e.g., knowledge and understanding), psychological (e.g., motivation and confidence), and social (e.g., communication and collaboration) domains, enacted through meaningful participation in physical activity. For children with disabilities, however, physical literacy may be narrowly applied, with an overemphasis on physical competence and under-recognition of the breadth and depth of their psychosocial and cognitive experiences and capabilities. This entry traces the evolution of physical literacy, from its origins in physical education to its increasing adoption in pediatric rehabilitation. It examines the concept alongside established health models, such as the International Classification of Functioning, Disability and Health and the Family of Participation-Related Constructs, illustrating how physical literacy aligns with frameworks for understanding function and participation. This entry highlights inclusive and contextual features embedded in existing definitions of physical literacy and explores how these features could be best articulated and applied in practice. It emphasizes the critical need to center the voices of children with disabilities not only as participants, but as co-designers and decision-makers. Drawing on evidence from physical activity research, this entry outlines practical strategies for assessment, intervention, and implementation that prioritize participation, lived experience, and collaboration across the traditionally distinct sport, health, and education sectors. When communicated clearly and applied holistically, physical literacy offers a powerful framework to support participation for all children. By meaningfully and consistently involving children with disabilities, physical literacy can be inclusive not just in theory, but in practice.