This study investigates the AI assessment literacy of high school EFL teachers using the Chinese AI-powered chatbot, ERNIE Bot. Interviews and digital protocols revealed a dynamic relationship between teachers’ practical and conceptual knowledge, with both areas mutually reinforcing each other. However, technical knowledge emerged as a potentially independent domain, operating separately from practical and conceptual understandings. This finding underscores the importance of recognizing technical proficiency as a critical component of AI assessment literacy, alongside the interconnectedness of practical and conceptual knowledge.