As a fundamental experimental study for reliability improvement of lithium ion secondary battery, degradation mechanism was investigated by microscopic observation and acoustic emission monitoring. Microstructural observation of the decomposed battery after cycle test revealed mechanical and chemical damages such as interface delamination, microcrack of the electrodes, and solid electrolyte interphase (SEI). Acoustic emission (AE) signal was detected during charge and discharge of lithium ion battery to investigate relationships among cumulative count, discharge capacity, and microdamages. With increasing number of cycle, discharge capacity was decreased and AE cumulative count was observed to increase. Observed damages were attributed to sources of the detected AE signals.