A high-performance LiNi0.8Co0.2O2 cathode was successfully fabricated by a sol–gel coating of CeO2 to the surface of the LiNi0.8Co0.2O2 powder and subsequent heat treatment at 700°C for 5h. The surface-modified and pristine LiNi0.8Co0.2O2 powders were characterized by X-ray diffraction (XRD), scanning electron microscopy (SEM), slow rate cyclic voltammogram (CV), and differential scanning calorimetry (DSC). Unlike pristine LiNi0.8Co0.2O2, the CeO2-coated LiNi0.8Co0.2O2 cathode exhibits no decrease in its original specific capacity of 182mAh/g (versus lithium metal) and excellent capacity retention (95% of its initial capacity) between 4.5 and 2.8V after 55 cycles. The results indicate that the surface treatment should be an effective way to improve the comprehensive properties of the cathode materials for lithium ion batteries.