A simple approach was developed for the fabrication of a Fe 2O 3/carbon composite by impregnating activated carbon with a ferric nitrate solution and calcinating it. The composite contains graphitic layers and 10 wt.% Fe 2O 3 particles of 20-50 nm in diameter. The composite has a high specific surface area of ∼828 m 2 g -1 and when used as the anode in a lithium ion battery (LIB), it showed a reversible capacity of 623 mAh g -1 for the first 100 cycles at 50 mA g -1. A discharge capacity higher than 450 mAh g -1 at 1000 mA g -1 was recorded in rate performance testing. This highly improved reversible capacity and rate performance is attributed to the combination of (i) the formation of graphitic layers in the composite, which possibly improves the matrix electrical conductivity, (ii) the interconnected porous channels whose diameters ranges from the macro- to meso- pore, which increases lithium-ion mobility, and (iii) the Fe 2O 3 nanoparticles that facilitate the transport of electrons and shorten the distance for Li + diffusion. This study provides a cost-effective, highly efficient means to fabricate materials which combine conducting carbon with nanoparticles of metal or metal oxide for the development of a high-performance LIB. © 2012 Elsevier Ltd. All rights reserved.