Low health literacy is associated with poorer health outcomes. A key strategy to address health literacy is a universal precautions approach, which recommends using health-literate design for all health interventions, not just those targeting people with low health literacy. This approach has advantages: Health literacy assessment and tailoring are not required. However, action plans may be more effective when tailored by health literacy. This study evaluated the impact of health literacy and action plan type on unhealthy snacking for people who have high BMI or type 2 diabetes (Aim 1) and the most effective method of action plan allocation (Aim 2). We performed a 2-stage randomised controlled trial in Australia between 14 February and 6 June 2019. In total, 1,769 participants (mean age: 49.8 years [SD = 11.7]; 56.1% female [n = 992]; mean BMI: 32.9 kg/m2 [SD = 8.7]; 29.6% self-reported type 2 diabetes [n = 523]) were randomised to 1 of 3 allocation methods (random, health literacy screening, or participant selection) and 1 of 2 action plans to reduce unhealthy snacking (standard versus literacy-sensitive). Regression analysis evaluated the impact of health literacy (Newest Vital Sign [NVS]), allocation method, and action plan on reduction in self-reported serves of unhealthy snacks (primary outcome) at 4-week follow-up. Secondary outcomes were perceived extent of unhealthy snacking, difficulty using the plans, habit strength, and action control. Analyses controlled for age, level of education, language spoken at home, diabetes status, baseline habit strength, and baseline self-reported serves of unhealthy snacks. Average NVS score was 3.6 out of 6 (SD = 2.0). Participants reported consuming 25.0 serves of snacks on average per week at baseline (SD = 28.0). Regarding Aim 1, 398 participants in the random allocation arm completed follow-up (67.7%). On average, people scoring 1 SD below the mean for health literacy consumed 10.0 fewer serves per week using the literacy-sensitive action plan compared to the standard action plan (95% CI: 0.05 to 19.5; p = 0.039), whereas those scoring 1 SD above the mean consumed 3.0 fewer serves using the standard action plan compared to the literacy-sensitive action plan (95% CI: -6.3 to 12.2; p = 0.529), although this difference did not reach statistical significance. In addition, we observed a non-significant action plan × health literacy (NVS) interaction (b = -3.25; 95% CI: -6.55 to 0.05; p = 0.054). Regarding Aim 2, 1,177 participants across the 3 allocation method arms completed follow-up (66.5%). There was no effect of allocation method on reduction of unhealthy snacking, including no effect of health literacy screening compared to participant selection (b = 1.79; 95% CI: -0.16 to 3.73; p = 0.067). Key limitations include low-moderate retention, use of a single-occasion self-reported primary outcome, and reporting of a number of extreme, yet plausible, snacking scores, which rendered interpretation more challenging. Adverse events were not assessed. In our study we observed nominal improvements in effectiveness of action plans tailored to health literacy; however, these improvements did not reach statistical significance, and the costs associated with such strategies compared with universal precautions need further investigation. This study highlights the importance of considering differential effects of health literacy on intervention effectiveness. Australia and New Zealand Clinical Trial Registry ACTRN12618001409268.