The accuracy for positional alignment of the positive electrode vs. the negative electrode is of great importance for the quality of assembly of lithium ion cells. Area-oversized negative electrodes increase the tolerance for electrode alignment. In this study, the impact of area-oversizing of the negative electrode on the specific capacity losses during charge/discharge cycling is systematically investigated by using electrochemical and analytical methodologies. It is shown, that with a higher degree of area-oversizing more active lithium is kinetically trapped in the outer negative electrode areas (“overhang”), causing performance-deteriorating losses in usable specific capacity. Nevertheless, most of this “lost” specific capacity is of reversible nature as the trapped active lithium can be electrochemically recovered, which is analytically proven by inductively coupled plasma-optical emission spectrometry (ICP-OES) and laser ablation-inductive coupled plasma-mass spectrometry (LA-ICP-MS). Given this relation, a periodic application of a short constant voltage step after discharge results in a significant performance increase. In contrast, holding the cell in the charged state is detrimental for cells with area oversized negative electrodes as the amount of reversible and irreversible trapped active lithium increases. Based on the obtained insights, the influence of variations of the electrochemical conditions on charge/discharge cycling performance is discussed.