Li3PO4 impurity was found in hydrothermally grown LiFePO4 samples made with excess Li. The impurity dissociates in water, leading to an apparent alkaline nature of the LiFePO4 sample. The impurity can be removed by washing the sample in a neutral buffer solution, after which an increase in specific capacity of the LiFePO4 sample was observed. Li3PO4, as an inactive component within the active material, reduces the energy density of LiFePO4. Additional experiments were performed to study the reactivity of LiFePO4 in different environments. It is found that LiFePO4 decomposes in a strong alkaline solution and the decomposition can be slowed down by carbon coating the material. After prolonged storage in water, the specific capacity of carbon-coated LiFePO4 is reduced and Fe dissolution is observed. Material degradation is thought to be due to interactions among LiFePO4, impurities, and water. (c) 2008 The Electrochemical Society.