Lithium iron phosphate (LFP) is widely considered as a low-potential positive electrode material. Herein, the high-voltage stability and capacity retention of LFP composite electrodes are investigated at potentials up to 5.0 V (versus Li+/Li) using Li-metal containing half-cells and an electrolyte composed of 1.0 M LiPF6 dissolved in 1:1 ethylene carbonate (EC)/diethyl carbonate (DEC). The results indicate that LFP electrodes are stable at such high potentials and that cycling up to 5.0 V (versus Li+/Li) at a rate of 1 C yields a 15% higher capacity compared to cycling up to 4.0 V (versus Li+/Li). The results further indicate that the lithiation of delithiated LFP electrode is incomplete. This yields a diffusion-controlled capacity loss as some Li+ ions (and associated electrons) diffuse too far into the electrode to be accessible on the timescale of the subsequent delithiation. Analogue diffusion-controlled capacity losses are also demonstrated for LFP–graphite full-cells cycled up to 4.0 and 5.0 V. These insights, pave the way for new approaches to minimize capacity losses for lithium-ion batteries. The demonstrated high-voltage stability of LFP, also indicates that LFP can be used as a protective coating on high-voltage transition metal oxide positive electrodes.