Transition metal based binary oxides and nitrides are commonly known to undergo electrochemical conversion reaction with lithium in a lithium ion battery (LIB). Here, based on ex-situ X-ray diffraction and transmission electron microscopic studies, we propose an (de)insertion electrochemistry for a nanocrystalline vanadium nitride in a Li-ion cell. Upon carbon coating, the nano-VN delivers a stable capacity of 400 mAh g−1, which is comparable to the (de)insertion of one lithium per VN unit. A change in the electronic structure of VN, resulting from the Li+ ion insertion into the structure, is confirmed by temperature dependent magnetic susceptibility measurement.