The formation of LiBD4 by the reaction of LiD in a diborane/hydrogen atmosphere was analysed by in situ neutron diffraction and subsequent microstructural and chemical analysis of the final product. The neutron diffraction shows that nucleation of LiBD4 already starts at temperatures of 100 °C, i.e. in its low temperature phase (orthorhombic structure). However, even at higher temperatures the reaction is incomplete. We observe a yield of approximately 50% at a temperature of 185 °C. A core shell structure of the grains, in which LiBD4 forms a passivation layer on the surface of the LiD grains, was found in the subsequent microstructural (electron microscopy) and chemical (electron energy loss spectrometry) analysis. © the Owner Societies.