Oxygen-deficient LiV3O8 is considered as one of the promising cathode materials for lithium ion batteries (LIBs) because of its high cycling stability and rate capability. However, it is very difficult to control and study the content and position of V4+ and oxygen vacancies in LiV3O8, and therefore the mechanism of improving electrochemical performance of LiV3O8 is still unclear. Herein, we developed four LiV3O8 nanosheets with different V4+ and oxygen vacancy contents and positions. The physicochemical and lithium storage properties indicate that the V4+ and oxygen vacancies in the surface layer increase the contribution of pseudocapacitive lithium storage on the nanosheet surface. The V4+ and oxygen vacancies in the lattice improve the electrical conductivity of LiV3O8, and enhance the phase transformation and lithium ion diffusion rates. By adjusting the content of V4+ and oxygen vacancies, we obtained an oxygen-deficient LiV3O8 nanosheet which maintained more than 93% of the initial reversible capacity after 300 cycles at 5,000 mA·g−1. The V4+ and oxygen vacancies play an important role in improving the stability and rapidity of lithium storage. This work is helpful to understand the stable and fast lithium storage mechanism of oxygen-deficient LiV3O8, and might lay a foundation for further studies of other oxygen-deficient metal oxide electrodes for long-life and high-power LIBs.