The capacity degradation mechanism in lithium nickel–manganese–cobalt oxide (NMC) cathodes (LiNi_1/3Mn_1/3Co_1/3O₂ (NMC333) and LiNi_0.4Mn_0.4Co_0.2O₂ (NMC442)) during high-voltage (cut-off of 4.8 V) operation has been investigated. In contrast to NMC442, NMC333 exhibits rapid structural changes including severe micro-crack formation and phase transformation from a layered to a disordered rock-salt structure, as well as interfacial degradation during high-voltage cycling, leading to a rapid increase of the electrode resistance and fast capacity decline. The fundamental reason behind the poor structural and interfacial stability of NMC333 was found to be correlated to its high Co content and the significant overlap between the Co^3+/4+ t_2g and O²⁻ 2p bands, resulting in oxygen removal and consequent structural changes at high voltages. In addition, oxidation of the electrolyte solvents by the extracted oxygen species generates acidic species, which then attack the electrode surface and form highly resistive LiF. These findings highlight that both the structural and interfacial stability should be taken into account when tailoring cathode materials for high voltage battery systems.