Li-rich cathode materials are potential candidates for next-generation Li-ion batteries. However, they exhibit a large voltage hysteresis on the first charge/discharge cycle, which involves a substantial (up to 1 V) loss of voltage and therefore energy density. For Na cathodes, for example Na 0.75 [Li 0.25 Mn 0.75 ]O 2 , voltage hysteresis can be explained by the formation of molecular O 2 trapped in voids within the particles. Here we show that this is also the case for Li 1.2 Ni 0.13 Co 0.13 Mn 0.54 O 2 . Resonant inelastic X-ray scattering and 17 O magic angle spinning NMR spectroscopy show that molecular O 2 , rather than O 2 2− , forms within the particles on the oxidation of O 2− at 4.6 V versus Li + /Li on charge. These O 2 molecules are reduced back to O 2− on discharge, but at the lower voltage of 3.75 V, which explains the voltage hysteresis in Li-rich cathodes. 17 O magic angle spinning NMR spectroscopy indicates a quantity of bulk O 2 consistent with the O-redox charge capacity minus the small quantity of O 2 loss from the surface. The implication is that O 2 , trapped in the bulk and lost from the surface, can explain O-redox.