Simplifying the design of high-performance electrodes via efficient catalyst design is critical for alkaline water electrolysis and supercapacitor applications. Towards that end, we have developed the environmentally benign synthesis of ultrathin nanosheets of NiFe-layered double hydroxides (LDH) with inbuilt oxygen vacancies (VO) in this report. These NiFe-layered double hydroxide (GNiFe-LDH-VO) materials require low overpotentials for the oxygen evolution reaction (OER, η50 = 200 and η100 = 220 mV) with a small Tafel slope of 52.21 mV dec−1. The ex-situ characterizations and theoretical calculations suggest that oxygen vacancies configure to a more active state, resulting in the low binding energy of oxo intermediates, and thus much lower overpotential. Besides, it could operate stably for 100 h at current densities of 100 mA cm−2 for OER. It is significant that oxygen vacancies in GNiFe-LDH-VO aid in lowering the main obstacle of multistep OER, which will provide recommendations for the development of high-efficiency catalysts through in situ activation. In addition, GNiFe-LDH-VO exhibits a high areal capacitance of 1.6024 F cm−2 at a current density of 1 mA cm−2, with a capacitance retention ratio of 96.1% after 5000 galvanostatic charge-discharge (GCD) cycles when they are used as supercapacitor electrodes.