Nickel and manganese-based layered oxides with a nickel content ranging from 50% to 80% are promising cathode materials for high-energy density lithium-ion batteries. However, these materials face challenges such as poor rate capability and limited cycling stability. The addition of excess lithium can mitigate these issues to some extent. This study examines the impact of incorporating small amounts of cobalt (5% or 10%) into these materials through an “all-dry” synthesis approach in stoichiometric and excess lithium-containing compositions. Results indicate that adding even these small amounts of cobalt decreases the cation mixing, improves crystallinity, reduces electronic resistance, and influences the morphology depending on whether nickel or manganese is replaced. The materials can accommodate up to 15% excess lithium without significant surface impurities. The addition of cobalt further enhances the rate capability of the material in excess lithium materials, but increasing cobalt content tends to compromise cycling stability when the materials are cycled up to 4.4 V. Materials in which 5% cobalt replaces nickel still exhibit superior rate capability and cycling performance compared to materials without cobalt. Therefore, incorporating small amounts of cobalt can positively impact the performance of Li1+x(Ni0.6Mn0.4)1−xO2 materials, offering a balance between improved rate capability and cycling stability.