Transition metal carbides may be the potential substitute material for anode in rechargeable energy storage system as a result of its good electrocatalytic performance, stable chemical property and reasonable economical efficiency. Unfortunately, they have disadvantages of limited theoretical capacity and poor cycling stability. To overcome these obstacles, a novel kind of nanocomposite, in which onion-like carbon encapsulated Fe3C nanoparticles are embedded in porous carbon, is designed and one-pot realized by arc discharging iron-graphite ingot under the flowing atmosphere of argon and H-2. When the designed nanocomposite is applied as anode in lithium-ion battery, it exhibits the stable electrochemical properties, featuring the long-term cycle performance (582 mA h g(-1) after being cycled at 0.2 A g(-1) for 500 times) and high rate capability (similar to 100% retention from 16 to 0.2 A g(-1)), originating from the systematic action of Fe3C nanoparticles, onion-like carbon layer and porous carbon.