["International Journal of Art &Design Education, EarlyView. ", "\nAbstract\nThe rapid integration of generative artificial intelligence (AI) into creative industries has intensified a ‘crisis of representation’, where the speed of production often masks deep‐seated cultural biases. This study investigates a studio‐based pedagogical intervention in a Cultural Studies class for third‐semester Indonesian digital media students, designed to support a transition from functional AI use to critical AI literacy (CAIL). Drawing on digital neocolonialism, semiotics, critical media literacy and production‐based pedagogy, the study operationalises ‘AI failure’ or the glitch, not as a technical error to be corrected, but as a productive site for learning. Through a design‐based research intervention, students generated culturally specific AI images, analysed misrepresentations through Barthes and Hall, and transformed their critiques into parody videos. The findings show that parody‐based making helped students move from passive acceptance or surface error‐spotting towards oppositional decoding and culturally grounded critique. Students identified recurring representational patterns, including Orientalist fantasy, the Java‐Bali default and contextual collapse, while also learning that effective parody requires explicit explanation, ethical framing and human judgement. The article contributes a transferable five‐session pedagogical framework for art and design educators seeking to teach CAIL through culturally situated creative production.\n"]