LiMn2O4 is one of the important cathode material for rechargeable lithium batteries. Standard ab initio studies within local density approximation (LDA) and generalized gradient approximation (GGA) are not able to reproduce the intrinsic insulating electronic structure and Jahn-Teller-type local atomic distortion of LiMn2O4. In the present work, GGA+U method is shown to be able to localize electrons to Mn 3d(z2) orbits in the majority spin channel, and open a gap of about 0.5 eV between the Mn 3d(z2) and Mn 3d(x2-y2). Results from GGA+U calculation showed that Mn ions are in the mixed valence state of Mn3+ and Mn4+. This is in good agreements with experimental observations and different to Mn3.5+ obtained from standard GGA calculations. While Jahn-Teller distortion is not observed in Mn4+O6 octahedra, it is clearly seen in Mn3+O6 octahedra, in which Mn-O bond lengths along the z-axis direction are obviously elongated. (C) 2008 Elsevier B.V. All rights reserved.