Abstract Increasing the energy density of lithium‐ion batteries (LIBs) raises safety risks. Understanding failure mechanisms, especially during abuse, is essential for improved battery design and management. In this study, multiscale characterization techniques are employed to systematically investigate the overcharge behavior (from 100% to 130% state of charge) of a 360 Wh kg −1 pouch cell with Ni‐rich cathode and SiO x @Graphite anode. Further decoupling elucidates that the primary failure mechanism is the interfacial and structural degradation of the anode, including lithium plating on graphite, volume expansion and crack propagation in SiO x particles, and continuous reconstruction of the solid electrolyte interphase (SEI) film, which are further promoted by dissolved Ni ions (the Ni content on the anode increases from 0.005% to 0.268% after overcharging to 5.25 V) and by released oxygen species from the Ni‐rich cathode. Ni ions (mainly as Ni 2+ ) accumulate on Li‐plating areas on graphite. These crosstalk reactions significantly influence the stability of both electrodes, causing severe phase transition (from LiC 6 to LiC 12 on the anode and from layered to rock‐salt phase on the cathode), continuous electrolyte decomposition and harmful gas evolution, which accelerates full‐cell failure. These findings can provide guidance for the optimization of battery safety management systems.