Silicon-graphite composite electrode is one of the most practical solution for next generation high performance lithium ion batteries. Electrode geometry design is a new strategy to improve the electrochemical performances. Herein, we report a unique hierarchical structure of Si@alginate microcapsule-graphite composite anode, in which Si microcapsules are prepared by wrapping of calcium cross-linked alginate. The Si@alginate microcapsules are uniformly dispersed in graphite anode with the widely adopted CMC and SBR binder. The new geometry of electrode architecture has locally different binder systems, which enables both Si and graphite run in their optimized binder environment. The cross-linked alginate capsule effectively confines the volume change and prevents aggregation of the Si nano-particles, which contribute to a significant improvement of the electrochemical performances. At a weight ratio of 3:7 between Si and graphite, the composite electrode exhibits a reversible capacity of 916 mAh g−1 and a capacity retention of 92.4% after 200 cycles. The new strategy for hybrid anode represents a promising avenue for the mass production of high performance Si-graphite composite anode in the future.