As‐prepared Li(Ni,Co)O2 with good electrochemical performance is an insulator with low degree of cation disorder, i.e. Li and (Ni,Co) are distributed on different and alternating layers. Lithium extraction in the first cycle induces an irreversible first‐order phase transition into a metallic phase with a discontinuous change in the c/a ratio by 3.6% and an accompanied partial occupation of some of the vacant Li‐sites by Ni‐ions. The specific arrangement of those Ni‐ions on Li‐layers is proposed as a key feature for the good cycling behaviour of Li(Ni,Co)O2 based cathodes in rechargeable batteries.