We propose a novel low-cost synthesis method of a LiFePO4/C composite with excellent battery performances that combine high-frequency induction heating with carbothermal reduction. Our method uses a very inexpensive Fe2O3 as a Fe source. The LiFePO4/C is synthesized in far less time (within a few minutes) at 900 °C than in a conventional method. Although the initially synthesized LiFePO4/C (LFP-120) contains such over-reduction impurities as Fe2P or Fe3P, optimized LiFePO4/C (LFP-90) containing no impurities is obtained by adjusting the heating time. Moreover, the primary particle size of the LFP-90 is sufficiently small to achieve fast Li-ion diffusion. The cathode containing LFP-90 has good charge–discharge rate performance and shows discharge capacities of 153.3 and 100.1 mAh g−1 at 1/10 and 10C-rates. The cathode with LFP-90 has excellent cycle stability and shows no degradation after high-rate charge–discharge tests. Our method reasonably reduces the manufacturing cost of LiFePO4/C.