Electrolyte decomposition and irreversible capacity loss (ICL) occur on carbon electrodes in Li-ion cells. The nature of the surface sites and their role in the amount of electrolyte decomposition on carbon electrodes is not fully understood. Therefore, a study was undertaken to analyze the relationship between the ICL and the active sires on natural graphite of prismatic structure. The ICL was measured on natural graphite of predominantly two-dimensional platelets of average particle size varying from 2 to 40 mu m. The fraction of edge and basal plane sites was determined for ideal prismatic structures of different particle size and used as a model for the natural graphite particles. This analysis permitted an analysis of the relationship between the electrolyte decomposition and the distribution of surface sites. From this analysis we conclude that these sites play an important role in the magnitude of the irreversible capacity loss on natural graphite.