The electrochemical behavior of propylene carbonate (PC)-based electrolytes with and without butyl sultone (BS) on graphite electrode and the performance of lithium ion batteries with these electrolytes were studied with cyclic voltammetry (CV), energy dispersive spectroscopy (EDS), as well as density functional theory (DFT) calculation. It is found that the co-insertion of PC with lithium ions into graphite electrode can be inhibited to a great extent by adjusting the composition of solvent in electrolytes. With the application of PC in the electrolyte without any additive, the discharge capacity of lithium ion battery is improved under high temperature or low temperature, however it decays under room temperature compared with the battery without PC. This drawback can be overcome by using BS as a solid electrolyte interphase (SEI) forming additive. BS has a lower LUMO energy and can be more easily electro-reduced than other components of solvent in electrolyte on a graphite electrode, forming a stable SEI film. With the application of BS in the electrolyte, the discharge capacity and cyclic stability of lithium ion battery is improved significantly under room temperature.