The structural and electrochemical properties of LiNiO2 powders were investigated as a function of the oxygen flow rate employed in the preparation of lithium nickel oxide. It was found that oxygen played an important role in the synthesis of highly crystallized LiNiO2(R(3) over bar m). In the crystallization process of LiNiO2, a deficiency of oxygen in the calcination reactor induced the formation of impurities and cubic rock-salt structure (Fm3m) in LiNiO2 powders. For LiNiO2 prepared at higher oxygen flow rates, the electrode delivered high discharge capacities with relatively good retention rates. But very low electrode capacity was obtained from LiNiO2 prepared at lower oxygen flow rates.