Homogeneous sub-micron sized particles of surface carbon coated phase pure LiFePO4 are synthesized by a novel non-aqueous oxalate-based sol-gel route. X-ray diffractogram of LiFePO4 reveals nanocrystals with average crystallite size 32(7) nm. The very large QS (nearly five times greater than that of Fe3+) value observed from Mossbauer spectrum is due to high spin configuration of 3d electrons and the asymmetric local environment at Fe site in LiFePO4. A uniform particle size distribution with grain size 100 - 150nm was observed in SEM with few irregular growths. Our synthetic route successfully overcomes the incidence of Fe3+, effectively controls undesirable particle growth and has the potential for upscaling and application as Li-ion battery cathodes. Progressive evolution of olivine structure by the interlock of FeO6 octahedra and PO4 tetrahedra with Li concentration is studied by introducing lithium in to LixFePO4 (0.0 × 1.0 ). A fairly abrupt phase transformation from monoclinic Fe3(PO4)2 to orthorhombic LiFePO4 shows up for x∼0.2 accompanied by structural disorder which gets stabilized at x 0.35. A systematic study of X-ray diffractograms shows nanocrystal nucleation and growth from an unstable low symmetry crystalline phase with considerable disorder.