Abstract: The release of the lattice oxygen due to the thermal degradation of layered lithium transition metal oxides is one of the major safety concerns in Li-ion batteries. The oxygen release is generally attributed to the phase transitions from the layered structure to spinel and rocksalt structures that contain less lattice oxygen. Here, a different degradation pathway in LiCoO2 is found, through oxygen vacancy facilitated cation migration and reduction. This process leaves undercoordinated oxygen that gives rise to oxygen release while the structure integrity of the defect-free region is mostly preserved. This oxygen release mechanism can be called surface degradation due to the kinetic control of the cation migration but has a slow surface to bulk propagation with continuous loss of the surface cation ions. It is also strongly correlated with the high-voltage cycling defects that end up with a significant local oxygen release at low temperatures. This work unveils the thermal vulnerability of high-voltage Li-ion batteries and the critical role of the surface fraction as a general mitigating approach.