The specific capacity of Fe-substituted Li2MnO3 (Li1.2Fe0.4Mn0.4O2) was improved by adjusting the preparation temperature of Fe–Mn co-precipitate below RT in order to suppress the spinel ferrite formation, which hinders the formation of homogeneous and reactive precursor. The degradation of discharge capacity with cycle could be suppressed by nominal 5% Al, Ni and Co doping. This means that Fe-substituted Li2MnO3 will be considered to be one of the near future positive electrodes for practical use by careful optimization of its preparation condition and chemical composition.