Self-discharge and transition metal dissolution weaknesses bother the application of LiNi0.5Mn1.5O4 cathode material due to the severe oxidation of electrolyte at the high voltage state. A novel additive, 1-propylphosphonic acid cyclic anhydride (PACA), is desirable to prevent this oxidation. CV and charge–discharge results reveal that adding 0.5% PACA can relieve the oxidation of electrolyte. Consequently, the self-discharge and transition metal dissolution are both suppressed effectively, which is validated by self-discharge tests, XPS, and EDX analyses. Moreover, using PACA as an additive enhances the capacity retention capability of LiNi0.5Mn1.5O4 at elevated temperatures significantly.