 Diethyl phenylphosphonite (DEPP) is used as a novel electrolyte additive to improve the cyclability of spinel LiMn2O4 upon cycling at elevated temperature (55 °C). The charge/discharge cycling stability results indicate that capacity retention of Li/LiMn2O4 cell is significantly improved from 40 to 78% at a rate of 1C (1C = 120 mAh g−1) when 1.0 wt% DEPP is added to the baseline electrolyte (1.0 M LiPF6 in EC/EMC/DEC (3:5:2, vol.%)) after 450 cycles at 55 °C. This improvement can be attributed to the preferential oxidation of DEPP to that of the baseline electrolyte and the subsequent formation of a protective film on the cathode surface. This passivation film suppresses detrimental electrolyte decomposition and in turn protects LiMn2O4 from further decomposition. Molecular energy level calculations, linear sweep voltammetry, and cyclic voltammetry results confirm that DEPP is oxidized on the cathode surface prior to the oxidation of carbonate solvents. Electrochemical impedance spectroscopy illustrates that the the cathode interfacial film generated from DEPP oxidation is more stable and robust than that of the surface film yielded from the baseline electrolyte’s decomposition. Ex situ surface-characterization results further support the claim that DEPP incorporation in the electrolyte suppresses the electrolyte oxidation at elevated temperature and the decomposition of LiMn2O4 cathode material as well.