The synthesis process of LiCoO2 prepared by l-apple acid (l-HOOCCH(OH)CH2COOH) assisted sol–gel method is studied by using Fourier transforms infrared spectroscopy, mass spectroscopy, simultaneous thermogravimetric and differential thermal analysis, X-ray diffraction analysis, and elemental analysis. The results show that lithium and cobalt ions are trapped homogeneously on an atomic scale throughout the precursor. Lithium carbonate and Co3O4 are intermediate products during heat treatment of the precursor. Moreover, the kinetics for formation of LiCoO2 by l-apple acid assisted sol–gel method is faster than the case of the conventional solid-state reaction between lithium carbonate and Co3O4. In comparison with the solid-state reaction, the sol–gel method significantly shortens the required reaction time for synthesizing LiCoO2, and also reduces the particle size. In the electrochemical test, it is found that the specific discharge/charge capacities as well as the coulomb efficiency substantially increase with increasing the calcination temperature. It is considered that LiCoO2 with a good-layered structure facilitates the insertion and de-insertion of lithium ions in aqueous electrolyte. As a result, the combination of the sol–gel method with proper calcination processes is highly successful in producing LiCoO2 powders with large specific capacity and good cycle performance in aqueous lithium-ion battery.