A novel one-dimensional (1D) V₂O₃@carbon nanocomposite has been successfully synthesized for the first time. In the synthesis procedure, the previously obtained V₂O₅·xH₂O nanobelts act as template. By coating the nanobelts with a layer of polymerized C species under hydrothermal conditions followed by a calcination treatment at elevated temperature in an inert atmosphere, the V₂O₃@carbon nanocomposite was finally obtained. This nanocomposite consists of a well-graphitized carbon layer encapsulating the V₂O₃ nanostructures. The as-synthesized V₂O₃@carbon nanocomposite exhibits improved electrochemical performance in Li-ion batteries as the anode, showing enhanced stability, reversibility and cyclability in long-term cycles. At least a 98.5% capacity retention (660 mAh g⁻¹) was observed after high-rate galvanostatic measurements (250 cycles). These results indicate that the V₂O₃@carbon nanocomposite is a promising candidate as an anode material for next generation Li-ion batteries. In addition, this nanocomposite may also be a promising material for other important applications such as supercapacitors.