As artificial intelligence reshapes how students access, evaluate, and create information, academic libraries stand at the heart of ensuring equitable AI literacy across higher education. This session explores how academic librarians can create safe, judgment-free spaces within information literacy and research instruction where students explore AI's complexities, experiment with emerging tools, and develop critical evaluation skills. Attendees will learn practical approaches to integrating AI literacy into existing library instruction programs, including a detailed outline of a newly developed for-credit AI literacy course based on the ACRL Framework for Information Literacy for Higher Education. Participants will leave with concrete strategies for teaching students to use AI to enhance rather than replace research processes while upholding academic integrity and information ethics.