Nano Ag4Bi2O5 as a novel cathode material of rechargeable alkaline batteries was successfully synthesized by precise control of precipitation reaction. KOH solution was used as precipitant and a mixture of AgNO3 and Bi(NO3)3 as Ag–Bi source. The experimental results indicate that concentration of KOH, reaction temperature and PH value have the effects on the structure and electrochemical property of the product. The material was characterized by means of XRD, FSEM and TG–DSC. The results show that the sample is single crystals with 50–100nm in width and 600–800nm in length. The electrochemical performances of Ag4Bi2O5 in the alkaline electrolyte were measured by galvanostatic method and cyclic voltammetry tests through film electrode. The sample shows three typical procedures during the charge–discharge, corresponding to Ag(II)–Ag(I), Ag(I)–Ag(0) and Bi(III)–Bi(0) transformation processes. This result is also verified by XRD tests. The Ag4Bi2O5 electrode has excellent electrochemical properties. It undergoes a current density as high as 20Ag−1, which greatly reduces charge time down to 55.9s. The electrode offers a cycling capacity of 330mAhg−1 and a cycling life more than 400 cycles at 1–2Ag−1.