A comprehensive analysis of the degradation mechanisms on the surface of commercial LiNi0.5Co0.2Mn0.3O2 electrodes is presented. Irregularly distributed particle cracking and the formation of a cathode electrolyte interphase on the surface of the active material were identified to be the main degradation mechanisms. The particle cracking originates from inhomogeneity of the composite electrode, leading to deviations in the local current density and the state of charge which results in overcharge conditions for particular LiNi0.5Co0.2Mn0.3O2 particles. Therein, the highly delithiated structure suffers from anisotropic stress due to repulsive interactions between adjacent layers and the formation of new phases which eventually cause particle cracking. The structural changes were confirmed by the presence of a spinel phase on the surface of the cracked particles. Furthermore, the migration of transition metal ions in the highly delithiated structure can facilitate their dissolution into the electrolyte. The investigation of the re-deposited transition metals reveals a predominant dissolution of manganese from the overcharged particles. In addition, electrochemical cycling of the LiNi0.5Co0.2Mn0.3O2 electrodes in laboratory cells show an increasing severity of the particle cracking at higher C-rates which can influence the thermal stability of the active material. Moreover, an increased electrolyte decomposition was observed for higher cut-off potentials.