A citric acid assisted sol-gel method is employed for synthesizing LiNi0.6Co0.2Mn0.2O2 for use as a cathode material in lithium-ion batteries. The effects of heat-treatment temperature and oxygen atmosphere on the structural and electrochemical properties of LiNi0.6Co0.2Mn0.2O2 are investigated, in order to determine optimal conditions for the synthesis of LiNi0.6Co0.2Mn0.2O2 via the citric acid assisted sol-gel method. In particular, the presence of oxygen in the atmosphere effectively leads to a decrease in the degree of cation mixing and the formation of LiOH and Li2CO3 on the surface of LiNi0.6Co0.2Mn0.2O2. Furthermore, heat-treatment in an oxygen atmosphere improves the uniformity of oxidation state of Ni ions between the surface and bulk. LiNi0.6Co0.2Mn0.2O2 synthesized by heat-treatment at 850 °C under an oxygen atmosphere shows a discharge capacity of 174 mA h g−1 and 89% capacity retention after 100 cycles. In addition, it shows high rate capability (i.e., 41% capacity retention at 10 C), which is an improved rate performance over a previous report. The results of this study should provide useful information for the synthesis of Ni-rich layered oxides for lithium ion batteries.