Li-rich layered cathode materials have received wide attention due to their superior Li-storage capability. However, their applications are still limited by capacity degradation and voltage decay, which is caused by the phase transition and metal dissolution during repeated cycling. In this work, iron oxide (FeOx) atomic layer deposition (ALD) was performed on Li-rich layered cathode powders in a fluidized bed reactor, followed by an annealing process to further improve their electrochemical performance. After 100 cycles of charge-discharge at 55 °C and 1C (1C = 250 mA g−1), the cathode made from particles with 40 cycles of FeOx ALD and annealing showed a 73% retention of the initial capacity (221 mAh g−1), while the electrode made from the pristine powders showed only 26% retention of the initial capacity (197 mAh g−1) at the same conditions. The enhancement of Li+ transport and cyclic stability stemmed from a stable Fe-doped spinel phase on the surface of cathode particles after ALD coating followed by annealing. A detailed post-test analysis demonstrated that the modification limited impedance growth and suppressed electrolyte degradation and metal dissolution.