Physical literacy serves as the foundation for several skills or attributes needed for lifelong physical activity participation. Based on its connection to physical activity, physical literacy has been associated with a wide variety of positive health outcomes. While research suggests that teachers play a crucial role in fostering children's physical literacy, however, few psychometrically sound measures have been designed for teachers to assess physical literacy in children. A teacher proxy-report instrument that assesses the four physical literacy domains (i.e., physical, psychological, social, and cognitive), along with the comprehensive set of 30 elements proposed by the Australian Physical Literacy Framework, could provide a useful metric for teachers to assess children's physical literacy levels. Accordingly, this article provides a rationale for developing such a tool for physical literacy assessment, focusing on children aged 5-12 years, using Sport Australia's definition and framework for physical literacy.