The article gives a totally new understanding about lithium insertion behavior of Li3VO4 as potential anode material for Li-ion batteries. The carbon-coated Li3VO4 (Li3VO4/C) sample was synthesized firstly using simple solid-state method. X-ray diffraction, Raman spectra and Rietveld refinement results show that single-phase Li3VO4/C can be obtained even under the presence of carbon and reducing atmosphere. The final product demonstrates a favorable electronic conductivity with 6.67% residual carbon. Electrochemical testing shows that Li3VO4/C holds both much higher specific capacity and better electrochemical performance than that of carbon-free Li3VO4 sample. The Li3VO4/C electrode display a discharge capacity of 738.5 mAh g−1 and a charge (reversible) capacity of 547.1 mAh g−1 with a high initial coulombic efficiency of 78.0% in the first cycle. First-principles calculation and GITT results illustrate that the maximum embeddable Li-ion number in a single cell is 3 corresponding to the change of V5+ to V2+, and the Li-inserted sites is predicted by first-principles calculations. Furthermore, lithium insertion/de-insertion mechanism of Li3VO4/C is studied by in-situ XRD, and the results surely confirm that Li3VO4/C undergoes a reversible insertion/de-insertion mechanism during discharge/charge process.