To extend the lifespan of Ni-rich layered oxide cathodes, doping, coating, and particle-morphology optimization strategies have been explored, though these approaches often result in reduced reversible capacity. In this study, a novel LiNi0.92Co0.04Mn0.04O2 cathode is introduced featuring gradients in Li concentration and particle size at the secondary-particle level. By controlling the oxygen partial pressure during synthesis, enhanced cycle stability is achieved without compromising the capacity of this unique structure. Contrary to common knowledge, the superior performance of cathode materials synthesized under oxygen-deficient conditions is reported, delivering a remarkable capacity of 226.7 mAh g−1 and robust cycle retention of 87.23% after 200 cycles. These electrodes achieve 85.08% capacity retention at 2 C/0.1 C, demonstrating excellent rate performance. Comprehensive diffraction and microscopy analyses identify secondary particles with Li-excess structures on their surfaces (characterized by larger primary particles) and stoichiometric structures in the core (featuring smaller primary particles). This dual-gradient structure enhances performance by suppressing surface reactions and stabilizing the bulk. Furthermore, the electrodes retain pristine microstructure during electrochemical cycling, minimize lattice contraction (3.86%), and suppress H2-to-H3 transitions. This study highlights the potential of using Li concentration gradients to mitigate surface side reactions, paving the way for the development of durable, high-capacity, and cost-effective cathodes.