Layered oxide cathode materials, such as Li-Ni a Co b Mn c O 2 or LiNi a Co b Al c O 2 , are sought after mainly because of their high theoretical specific capacity. Especially those with a high nickel content are being pursued to increase capacity and lower costs. In these materials, substitutional defects are a common feature and are typically associated with poor overall quality. Herein, we employ a sodium-to-lithium ion exchange to produce LiNiO 2 (LNO) without such characteristic defects. Three different methods are used to tailor the primary particle (grain) size over a broad range, and each material is subjected to electrochemical testing. By analyzing the initial charge/discharge profiles, we separate kinetic hindrance and structural degradation as two independent contributions to the first-cycle capacity loss. We find that the Ni Li• point defects stabilize LNO at high potentials and help mitigate material degradation while leading to incomplete discharge. The kinetic hindrance at the end of discharge vanishes upon their removal, but the degradation at high states of charge becomes more pronounced. We examine the cause of material degradation and corroborate the results by artificially introducing pillaring Mg 2+ ions through a novel dual-ion exchange as a model system for nickel substitutional defects. This methodology may be exploited to identify an optimal concentration of pillar ions, especially in a range of defect densities that are inaccessible by conventional solid-state synthesis.