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Background: The periodic and seasonal outbreaks of cholera in Ghana make the disease a vital health concern. The country is cholera endemic with several communities within cholera hotspots. This study, therefore, assesses health literacy on cholera and the association between health literacy competency and health outcome. Methods: The study adopted a health literacy framework that theorized the pathways between health literacy and health outcomes controlling for confounding factors. A survey questionnaire was administered to a representative sample of 401 individual household heads in James Town, Accra, Ghana. Reliability analysis was undertaken to ascertain the internal consistency of the instrument. Bivariate methods of analyses used were chi-square tests, ANOVA, Mann–Whitney U test, and Kruskal–Wallis test. Binary logistic regression models were run to examine the relative effects of health literacy competency on health outcome (having not had cholera). Results: There are substantial knowledge gaps about environmental risk factors for cholera like the presence of the cholera germ in coastal water, as well as the likelihood of contracting cholera due to overcrowded spaces. However, better knowledge on cholera risk factors was found to be associated with better health literacy competency (food safety and personal hygiene practices). An increase in health literacy competency score was associated with lower likelihood of having had cholera, after controlling for intermediate factors. Conclusion: Furthering health literacy on cholera environmental risk factors as well as a deliberate and targeted effort in encouraging consistency in the translation of disease knowledge into healthier practices may improve the well-being of the people. [ABSTRACT FROM AUTHOR]