Background: The public harbors adverse perceptions of individuals with mental illness. The global prevalence of mental health illnesses has consistently risen. Untreated mental illness in high school adolescents can result in social, behavioral, and academic problems. Methods: A respondent-driven sample of 716 high school teachers working in Najran city was surveyed. The participants completed questionnaires assessing their mental health knowledge and Perceived Devaluation and Discrimination. Results: Almost two-thirds of participants had adequate knowledge. The highest knowledge scores were found in the items related to the effectiveness of medication and psychotherapy. Schizophrenia was the most recognized mental health condition, followed by bipolar disorder and depression (mean scores 4.3, 4.0, 3.9, respectively). Almost two-thirds of the study participants (73.6%) had high perceived stigma in the total score of the PDD scale. The highest scores of perceived stigma were found in the scale items related to hiring a qualified person with severe mental illness (86.3%) and being close friends with a person with severe mental illness (85.6%). Participants with adequate knowledge had more perceived social stigma than those with inadequate knowledge (77% versus 66%). There were statistically significant associations between Stigma-related mental health knowledge and socio-demographic characteristics of the study participants (p < 0.05). Conclusions: This study found that, despite the foundational level of knowledge, particularly regarding treatment effectiveness, gaps exist in understanding help-seeking behaviors. Socio-demographic factors play a role in shaping mental health literacy among high school teachers in Najran city.