Based on a displacement reaction mechanism, Cu2Se is a good candidate for non-insertion-based cathode materials of rechargeable magnesium batteries. Nevertheless, its relatively low electronic conductivity leads to a poor rate capability and an unsatisfactory cycling performance. In this work, we firstly reported the improved electrochemical performance of Cu2Se cathode based on displacement reaction for Mg batteries triggered by a Li salt additive in a typical magnesium electrolyte 0.4 mol dm−3 (PhMgCl)2-AlCl3/THF. Cu2Se materials with different morphologies and particle sizes were synthesized by a solvothermal process and a hydrothermal method, respectively. Cu2Se with smaller particle sizes by the hydrothermal method exhibits a higher specific capacity (152.7 mAh g−1 first discharge capacity at 0.02 C) but poor cycling performance in 0.4 mol dm−3 (PhMgCl)2-AlCl3/THF electrolyte. LiCl was added in the magnesium electrolyte to promote the displacement reaction of the Cu2Se material. An initial discharge capacity of approximately 239.7 mAh g−1 with 48.4% capacity retention after 20 cycles at 0.1 C can be obtained for Cu2Se in 0.4 mol dm−3 (PhMgCl)2-AlCl3+1.0 mol dm−3 LiCl/THF electrolyte. Furthermore, the cycling performance and rate capability are enhanced by in situ homogeneously anchoring Cu2Se particles onto the surface of the reduced graphene oxide (rGO) nanosheets. Cu2Se/rGO composite with 10 wt% rGO exhibits 64.2% capacity retention after 20 cycles at 0.1 C, and a more than 120 mAh g−1 reversible capacity at 0.2 C in the hybrid Mg2+/Li+ electrolyte.