Porous hollow Fe₃O₄ beads constructed with rod-shaped Fe₃O₄ nanoparticles were synthesized via a facile solvothermal route. The formation mechanism of the obtained Fe₃O₄ beads was proposed on the basis of oriented assembly and Ostwald ripening. The as-prepared Fe₃O₄ beads had promising applications as lithium ion battery anodes, which showed a reversible specific capacity of 500 mAh g⁻¹ after 50 cycles at 100 mA g⁻¹. After being decorated with a carbon coating layer, the Fe₃O₄/C composite beads showed an enhanced capacity of 700 mAh g⁻¹ after 50 cycles at 100 mA g⁻¹. Such a satisfactory electrochemical performance was due to several factors of the Fe₃O₄/C composite beads including high theoretical capacity of Fe₃O₄, nanosized active Fe₃O₄ particles, hollow porous structure that mitigated the volume change problem, and carbon coating layer that enhanced both the electronic conductivity and structure integrity.