A low cost and facile way was developed to prepare high performance Fe2O3/natural graphite electrode for lithium ion batteries. For the purpose of reducing the cost and improving the feasibility of large-scale fabrication, commercial ferric oxide and natural graphite were adopted as raw materials and mechanical milling was adopted as preparation method in material fabrication process, and water soluble sodium alginate was adopted as binder in electrode preparation procedure. The Fe2O3/natural graphite electrode delivers initial discharge and charge capacity of 943.8 and 691.4 mAh g(-1) at a specific current of 72 mA g(-1), maintaining of 687.6 and 679.3 mAh g(-1) after 100 cycles. After 60 cycles at various specific currents from 104 to 3470 mA g(-1), the discharge and charge capacity of the Fe2O3/natural graphite electrode can restore well when lowering the specific current to 104 mA g(-1). A novel electrochemical reconstruction between Fe2O3 and natural graphite was observed for the electrode after cycling, which results in the formation of an integrated architecture with good combination between Fe2O3 and natural graphite, being responsible for the good electrochemical performance. (C) 2014 Elsevier Ltd. All rights reserved.