Yes, letter is a Scrabble word!

Verb

1. Win an athletic letter

2. Set down or print with letters

3. Mark letters on or mark with letters

Noun

1. A written message addressed to a person or organization

2. The conventional characters of the alphabet used to represent speech

3. Owner who lets another person use something (housing usually) for hire

4. A strictly literal interpretation (as distinct from the intention)

5. An award earned by participation in a school sport