Commercially available anatase TiO2 nanoparticles (ca. 15–20 nm particle size) were investigated as negative electrode material for Li-ion batteries. Despite the high initial specific charge of 200 mAh g−1 at 0.5C, the pristine commercial TiO2 failed to retain the reversible capacity upon cycling, keeping only 23% of the initial value after 80 cycles. X-ray photoelectron spectroscopy (XPS) results together with electrochemical data suggest that the failure in cyclability is of kinetic nature as the loss in specific charge is not completely irreversible. Thermogravimetry analysis revealed that the pristine TiO2 contained a significant amount of TiO(OH)2 (ca. 8%) which can be easily removed by dehydration when annealing in air above 250 °C. Air-annealing of TiO2 at 300 °C resulted in a remarkable improvement in cyclability retaining 83% of initial specific charge after 80 cycles at 0.5C. No further improvement in cyclability was observed for TiO2 annealed at 450 °C suggesting that the dehydration of TiO(OH)2 was the primary source of the improvement. Knowing the role of dehydration of TiO2 allows obtaining a reliable benchmark material via simple air-annealing and becomes a key factor when developing advanced materials from commercial TiO2.