Objective: Research has shown that developing health literacy in early life is critical to reducing lifestyle-related diseases, with schools being identified as central settings for this purpose. This paper examines how one classroom-based health educational programme, "IMOVE," helped Danish primary school pupils develop health literacy related to physical activity. It discusses curriculum-integrated health education's contribution to promoting health literacy. Design: Qualitative classroom observation. Setting: "IMOVE" was implemented in 12 school classes (grades 5-7) in four public schools in Copenhagen, Denmark, during the autumn and winter of 2013-2014. Participants numbered 281 pupils and nine teachers. Method: We used Nutbeam's conceptualisation of health literacy as a theoretical framework to assess which levels of health literacy the programme would promote; we assessed these using data derived from 59 "IMOVE" lesson transcripts. Results: "IMOVE" primarily contributed to the development of functional health literacy by building a relational understanding between everyday practice and step numbers. We observed the presence of interactive health literacy in discussions about how pupils and teachers could change their daily practices. Only a limited number of discussions supported the development of critical health literacy. Conclusion: Our findings suggest that educators can successfully integrate health literacy development into classroom-based curriculum teaching, with pupils' own step counts and associated reflections positively influencing learning. However, in this study, classroom teaching was limited to a focus on cognitive skills and only partially supported the development of more critical health literacy skills. Our findings call for further research into approaches to support classroom-based critical health literacy development.