Synthesis, characterization and cathodic behaviour of O2-phase layered manganese oxides, Li-2.3(Co0.15Mn0.85)O-2 (O2(Li)) and Li(2.3)-x(Co0.15Mn0.85)O-2 (O2(Li+x)) have been reported. The precursor compound for the synthesis is Na-2.3 (Co0.15Mn0.85)O-2. X-ray diffraction (XRD), infra-red (IR) and X-ray photoelectron spectra (XPS) data are consistent with that expected for both the compounds with regard to the structure and valence state. The first-charge capacities of O2(Li) and O2(Li+x) are 129 and 210 mA h/g, respectively, at 0.1 C rate and 2.5-4.6 V (vs. Li). Reversible capacities of 140-150 mA h/g were obtained for both the above compounds and the voltage vs. capacity profile shows an irreversible plateau at 4.3-4.6 V for the first charge, which is in accord with the cyclic voltammograms. An irreversible capacity loss (ICL) of 62 mA h/g is encountered in O2(Li+x) during the first charge and discharge. Performance of the Li-ion cell, C/electrolytel/O2(Li+x) has been evaluated and shows that the ICL of the compound is effectively utilized for the irreversible consumption of lithium by the graphite anode in the Li-ion cell, thereby demonstrating that the compound O2(Li+x) is a viable cathode material.