Cathode materials LiMn0.5Fe0.5PO4/C and LiMnPO4/C were synthesized by a high-energy ball-milling assisted sol-gel method. The LiMn0.5Fe0.5PO4 consists of nanorods and nanoparticles homogeneously wrapped with highly ordering carbon. The increased Néel-temperature and decreased effective magnetic moment of LiMn0.5Fe0.5PO4/C revealed the microstructure differences from LiMnPO4/C. Meanwhile, tiny amount of ferromagnetic impurities is detected in LiMn0.5Fe0.5PO4/C by magnetic tests. The synergetic effects of Fe substitution and carbon coating remarkably improve rate capacity and cyclic stability of LiMn0.5Fe0.5PO4/C. This solid solution delivers initial discharge capacities of 128.6mAhg−1 and 116.3mAhg−1 and capacity retentions of 93.5% and 90.3% after 100 cycles at 1C and 2C respectively, significantly better than LiMnPO4/C.