Flexible Li-ion batteries attract increasing interest for applications in bendable and wearable electronic devices. TEMPO-oxidized cellulose nanofibrils (TOCNF), a renewable material, is a promising candidate as binder for flexible Li-ion batteries with good mechanical properties. Paper batteries can be produced using a water-based paper making process, avoiding the use of toxic solvents. In this work, finely dispersed TOCNF was used and showed good binding properties at concentrations as low as 4 wt %. The TOCNF was characterized using atomic force microscopy and found to be well dispersed with fibrils of average widths of about 2.7 nm and lengths of approximately 0.1-1 μm. Traces of moisture, trapped in the hygroscopic cellulose, is a concern when the material is used in Li-ion batteries. The low amount of binder reduces possible moisture and also increases the capacity of the electrodes, based on total weight. Effects of moisture on electrochemical battery performance were studied on electrodes dried at 110 °C in a vacuum for varying periods. It was found that increased drying time slightly increased the specific capacities of the LiFePO4 electrodes, whereas the capacities of the graphite electrodes decreased. The Coulombic efficiencies of the electrodes were not much affected by the varying drying times. Drying the electrodes for 1 h was enough to achieve good electrochemical performance. Addition of vinylene carbonate to the electrolyte had a positive effect on cycling for both graphite and LiFePO4. A failure mechanism observed at high TOCNF concentrations is the formation of compact films in the electrodes.