Teacher-mediated classroom assessment might have significant impacts on learners' academic achievements and teachers' development. The current study investigated teachers' assessment literacy and its impact on their current assessment practices and learners' writing outcomes. The study sought to gain an understanding of the extent to which teachers' assessment literacy affects their practices and their learners' outcomes. To conduct the study and gather the required data, the researchers employed teachers' assessment literacy inventory, semi-structured interview, non-participatory observation, and Writing Competence Rating Scale (WCRS). Ten male EFL instructors and 75 male sophomores from Iranian EFL contexts were selected from four language schools in Iran. The results of the study indicated that teachers' assessment literacy has a statistically significant impact on learners' writing achievements and teachers' assessment awareness leads teaching environments into effective and motivated assessment design. These findings suggest language educators considering teachers' assessment awareness in their teacher education programs.