Functionalized multiwalled carbon nanotubes (CNTs) are coated with a 4-5 nm thin layer of V(2)O(5) by controlled hydrolysis of vanadium alkoxide. The resulting V(2)O(5)/CNT composite has been investigated for electrochemical activity with lithium ion, and the capacity value shows both faradaic and capacitive (nonfaradaic) contributions. At high rate (1 C), the capacitive behavior dominates the intercalation as 2/3 of the overall capacity value out of 2700 C/g is capacitive, while the remaining is due to Li-ion intercalation. These numbers are in agreement with the Trasatti plots and are corroborated by X-ray photoelectron spectroscopy (XPS) studies on the V(2)O(5)/CNTs electrode, which show 85% of vanadium in the +4 oxidation state after the discharge at 1 C rate. The cumulative high-capacity value is attributed to the unique property of the nano V(2)O(5)/CNTs composite, which provides a short diffusion path for Li(+)-ions and an easy access to vanadium redox centers besides the high conductivity of CNTs. The composite architecture exhibits both high power density and high energy density, stressing the benefits of using carbon substrates to design high performance supercapacitor electrodes.