Introduction Family carers are cornerstones in the care of older people living with dementia. Family carers report extensive carer burden, reduced health-related quality of life (HRQoL), and extensive time spent on informal care (Time). Health literacy (HL) is a concept associated with people's ability to access health services, and navigate the healthcare system. This study's aim was to investigate HL among family carers, and investigate the associations between HL and carer burden, HRQoL, and Time spent on informal care. Method We designed a self-administered survey comprising validated instruments, including the Health Literacy Scale (HLS-N-Q12) to measure HL, Relative Stress Scale (RSS) to measure carer burden, the EQ-5D-5L instrument to measure HRQoL, and some modified questions from the Resource Utilization in Dementia (RUD) questionnaire to measure time spent on informal care (Time). Descriptive analysis in addition to bivariate and multiple linear regressions were undertaken. In multiple linear regression analysis, we used HL as the independent variable to predict the outcomes (carer burden, HRQoL, Time). Analyses were adjusted for the effects of explanatory independent variables: age, gender, education levels, urban residency, having worked as health personnel, caring for someone with severe/mild dementia, and being born abroad. Findings In a non-probability sample of 188 family carers from across Norway, most of them female and over the age of 60, we found high levels of HL. In the bivariate analysis, carer burden and HRQoL (EQvalue) showed significant associations with HL. In the multiple regression analyses, HL was statistically significantly associated with carer burden (B = -0.18 CI:-0.33,-0.02 p = 0.02), HRQoL (EQvalue: B = 0.003 with 95% CI: 0.001, 0.006 p = 0.04), and Time (B = -0.03 with 95% CI: -0.06, 0.000, p = 0.046), after adjusting for the effect of independent variables. Conclusion This is one of the first studies to investigate the associations between HL and different outcomes for family carers of older people living with dementia. Additional research into the associations identified here is needed to further develop our understanding of how to support family carers in their roles. Targeted support that increases family carers' HL may have potential to enhance their ability to provide sustainable care over time.