In this paper, nano-sized LiFePO4 particles with a uniform carbon coating were produced using FePO4 as the iron source and PVA gel as the carbon source. Due to the special ability of PVA gel to form films readily, after it was mixed with the FePO4 during the ball-milling process, PVA films were formed readily around FePO4. As shown by the TEM results, the PVA films were successfully transformed into a perfect carbon coating around the LiFePO4 during calcination. The Raman spectrum showed the high quality of the obtained carbon layer, and the LiFePO4/C composites exhibited a high capacity and rate capacity retention at the rates of 0.1C and 20C. These results are indicative of the advantages of using PVA gel as a carbon source and its contribution to the excellent electrochemical performance of LiFePO4/C composite nanoparticles.