ithium-rich layered oxide Li[Li0.2Mn0.54Ni0.13Co0.13]O2 coated with V2O5 layers (labeled as LMNCO@V2O5) has been synthesized and its electrochemical properties as cathode material for lithium ion batteries have been measured and compared with pristine Li[Li0.2Mn0.54Ni0.13Co0.13]O2 (labeled as LMNCO) and LMNCO–V2O5 composite. As a lithium ions insertion host material, both the V2O5 in the LMNCO@V2O5 and the LMNCO–V2O5 can reduce the irreversible capacity losses and improve the Coulombic efficiencies of the cathode in the first charge-discharge cycle. However, for improving the cycling stabilities and the high-rate capabilities of the LMNCO, the effects of the V2O5 coating layers in the LMNCO@V2O5 are far beyond the effects of the V2O5 nanoparticles in the LMNCO–V2O5. When charge-discharged galvanostatically at 25 mA g−1 between 2.0 and 4.8 V (vs. Li+/Li), the LMNCO@V2O5 with 3 wt.% V2O5 exhibits a discharge capacity of 279.5 mAh g−1 in the first cycle and maintains a discharge capacity of 269.1 mAh g−1 after 50 cycles, with capacity retention of 96.3%. In contrast, the discharge capacity of the pristine LMNCO changes from 251.2 mAh g−1 in the initial cycle to 202.2 mAh g−1 in the 50th cycle, with capacity retention of 80.2%; and the LMNCO–V2O5 shows the same capacity fading trend as the pristine LMNCO, with no obvious improvement in the capacity retention. At high rate of 1250 mA g−1, the discharge capacity of the LMNCO@V2O5 can reach 113.6 mAh g−1, which is much higher than the capacities that the pristine LMNCO and the LMNCO–V2O5 can reach. Different effects of V2O5 are due to their different roles in the cathode materials. While the V2O5 coating layer in the LMNCO@V2O5 can reduce the charge transfer resistance at the electrode-electrolyte interfaces and improve the transportation of lithium ions among the LMNCO particles, the V2O5 nanoparticles in the LMNCO–V2O5 can only work as a Li+ ions insertion host material.