This case study details a library instruction activity developed by a team of academic librarians, which intended to leverage experiential learning to make students and faculty aware of the function, capabilities, and limitations of text-generating artificial intelligence (AI) tools like OpenAI's ChatGPT. The activity is described, with its development connected to key instructional theories and frameworks. Feedback is shared from student, faculty, and librarian perspectives, and future possibilities for academic librarians to grow and adapt similar AI literacy activities are explored.