The physical properties of ferrites are very sensitive to microstructure, which in turn critically depends on the manufacturing process. Lithium ferrite is synthesized by milling process. The powder was annealed at four different temperatures 600, 800, 1,000 and 1,200°C. The powder annealed at 600°C has the spinel structure with some of a-Fe 2 O 3 , while the powders annealed at C800°C formed in single-phase cubic spinel structure. Particle size of lithium ferrite is in the range of 26-70 nm, and is dependent on the annealing temperature. The saturation magnetization increased from 22 to 85 emu/g and the coercivity decreases from 124 to 4 Oe with increase in the annealing temperature. The dielectric constant (e'), dielectric loss (tan d) and ac conductivity (r ac ) were measured at room temperature as a function of frequency. The results of dielectric properties were explained in terms of Koops phenomenological theory.