The high cut-off voltage for delivering the high reversible capacity of LiCoO2 often causes its capacity fading and potential safety hazards. Herein, LiNi0.45Al0.05Mn0.5O2 is uniformly modified on LiCoO2 to prepare LiCoO2@LiNi0.45Al0.05Mn0.5O2 via a ball-milling method. In half-cell (or full-cell) tests, the LiCoO2@LiNi0.45Al0.05Mn0.5O2 exhibits the improved cycle stability between 3.00 V and 4.55 V (or 4.48 V). The capacity of LiCoO2@LiNi0.45Al0.05Mn0.5O2 with 1.0% modification content can be up to 161.9 mAh g−1 from 133.3 mAh g−1 of LiCoO2 after 150 cycles. The cyclability improvement of lithium ion batteries employing LiCoO2@LiNi0.45Al0.05Mn0.5O2 cathode is ascribed to a delay of structure collapse and a decrement of cobalt dissolution. Moreover, LiNi0.45Al0.05Mn0.5O2 on the LiCoO2 leads to an increase in the onset temperature of primary exothermic peaks, and a decrease in the maximum rising temperature of thermal shock from 500 °C to 160 °C while LiCoO2@LiNi0.45Al0.05Mn0.5O2/graphite full cell is charged to 4.48 V. The LiNi0.45Al0.05Mn0.5O2 improves thermal stability of the LiCoO2-based cathode by depressing O2 evolution and decreasing internal short dots.