Hydrothermal reactions between potassium permanganate and vanadyl sulfate have been used to synthesize new forms of vanadium oxides. Depending on the reactant ratios and pH values of the reaction mixtures, two different layered materials have been identified. The first one formed at a pH value of 1.6 has an interlayer distance of 10.90Å and a composition of K0.16Mn0.04V2O4.94·0.14H2O, while the second one formed at pH values higher than 3.0 has an interlayer distance of 9.45Å and a composition of K0.44V2O4.96. Structural analysis indicates that they have a δ-type structure with potassium ions residing in between double sheets of vanadium oxide. The structure and composition of these materials have a profound effect on their charge and discharge properties when used as cathodes in lithium batteries. The sample prepared at a pH value of 2.3 shows best overall performance considering both reversible capacity and cyclability, which is explained with the coexistence of two layered phases in the material. This material has a capacity of over 200mAh/g between 3.6 and 2.2V and retains a capacity of 190mAh/g after 30 cycles. Increase of manganese to vanadium ratio during synthesis leads to a gradual loss of the layered structure and decreased lithium insertion capacity.