Few-layer ternary FePS3 nanosheets, prepared via chemical vapor transport synthesis and ball-milling exfoliation, exhibit excellent electrocatalytic performance for the oxygen evolution reaction in an alkaline medium. Combined with first principles calculations, our X-ray spectroscopy and HRTEM results clearly reveal that the introduction of in-plane defects in FePS3 layers after exfoliation and formation of a FePS3-FeOOH heterostructure during the OER process largely contribute to the catalytic activity enhancement.