The advancement of lithium-ion battery technology relies on the development of materials that not only improve performance but also align with environmental sustainability. This work presents a novel water-based pectin-PEG binder for LiFePO4 cathodes that combines eco-friendliness with electrochemical innovation. The binder material is made by mixing pectin, a flexible natural substance, with polyethylene glycol through a radical copolymerization process. This combination gives the binder both flexibility and a boost in electrical performance. Our experimental results demonstrate that LFP cathodes with this binder have an intriguing self-healing ability in comparison with the conventional PVDF binder, enhanced charge-discharge capacities, improved cycling stability, and higher ionic conductivity. Specifically, electrodes utilizing the pectin-PEG binder exhibit an impressive retention of discharge capacity. They maintain roughly 150 mAh g−1 after 500 cycles at 1C with 99% retention, and about 141 mAh g−1 with 97% retention at 3C. Cyclic voltammetry (CV) confirms that the PP binder maintains its ionic diffusion properties at high sweep rates, whereas galvanostatic intermittent titration technique reveals a much higher lithium ion diffusion coefficient (DLi+) within the operational voltage range of the LFP-PP250 electrodes. These findings establish an attractive direction for the development of electrodes for high-energy density, sustainable lithium-ion batteries.