Vocabulary learning is a fundamental aspect of Indonesian language instruction for students with special needs, as it plays a significant role in developing communication skills and language comprehension. However, its implementation continues to face various challenges that affect the effectiveness of the learning process. This study aimed to analyze the characteristics of vocabulary instruction, identify the challenges encountered during instruction, and examine the need for interactive literacy media for students with special needs in Special Schools (SLBs). The study employed a descriptive qualitative approach using a needs assessment method. Data were collected through observations, semi-structured interviews, documentation, and supporting questionnaires involving 57 participants, consisting of classroom teachers, special education teachers, principals, and students from three Special Schools in Tegal and Brebes Regencies, Indonesia. Data were analyzed using the interactive model of Miles, Huberman, and Saldaña, including data condensation, data display, and conclusion drawing and verification. The findings revealed that vocabulary instruction was still predominantly teacher-centered, relying on lecture-based methods and simple learning media. The main challenges included limited educational facilities, diverse student characteristics, and teachers' limited competence in utilizing digital learning media. The needs assessment indicated that teachers require interactive literacy media integrating visual, audio, and interactive features to support vocabulary learning. These findings provide a foundation for developing interactive literacy media tailored to the characteristics and learning needs of students with special needs.