Lithium rich layered oxides (LLOs) are attractive cathode materials for Li-ion batteries owing to their high capacity (>250 mA h g^–1) and suitable voltage (∼3.6 V). However, they suffer from serious voltage and capacity fading, which is focused in this review. First, an overview of crystal structure, band structure and electrochemical performances of LLOs is provided. After that, current understanding on oxygen loss, capacity fading and voltage fading is summarized. Finally, five strategies to mitigate capacity and voltage fading are reviewed. It is believed that these understandings can help solve the fading problems of LLOs.