This article examines modern approaches to the development of students’ functional literacy in history lessons, drawing on international experience and research. Functional literacy is defined as the ability to apply reading, writing, and critical thinking skills in real-life situations. Within the context of history education, it encompasses working with historical sources, analyzing perspectives, constructing arguments, and understanding historical context. Particular attention is given to the practices of countries such as Finland, Canada, Australia, and Singapore, which have successfully integrated literacy into history teaching. The article also identifies key barriers, including insufficient teacher training, limited resources, and a mismatch between formal assessments and actual competencies. Effective strategies and practical recommendations are presented to support the integration of functional literacy into the educational process. The conclusion emphasizes the need for further cross-cultural and longitudinal studies in this field to foster critically thinking and socially responsible citizens of the 21st century.