A two step approach for synthesis of porous α-Fe2O3 nanostructures has been realized via polyol method by complexing iron oxalate with ethylene glycol. Crystalline Fe2O3 samples with different porosities are obtained by calcination of Fe-Ethylene glycol complex at various temperatures. The as-prepared porous Fe2O3 structures exhibit promising lithium storage performance at high current rates. It is observed that the calcination temperature and the resultant porosity have a significant effect on capacity and cycling stability. Samples calcined at high temperature (600 °C) demonstrates stable cycle life with capacity retention of 1077 mAh g−1 at 500 mA g−1 current rate after 50 charge-discharge cycles. Samples calcined at temperatures of 500 and 600 °C display stable cycle life and high rate capability with reversible capacity of 930 mAh g−1 and 688 mAh g−1 at 5 A g−1, respectively. Impregnation of electrodes with electrolyte before cell fabrication shows enhanced electrochemical performance. The viability of Fe2O3 porous nanostructures as prospective anode material examined against commercial LiFePO4 cathode shows promising electrochemical performance.