A facile water based synthesis method for HTB-FeF₃/rGO and r-FeF₃/rGO composites was developed using FeF₃ nanoparticles prepared by ball-milling and aqueous graphene oxide precursor. Electrodes of HTB-FeF₃/rGO were cast in ambient air and the calendered electrode shows a stable specific energy of 470 Wh kg^–1 (210 mAh g^–1, 12 mA g⁻¹) after 100 cycles in the range 4.3–1.3 V with very little capacity fading. The good cycle stability is attributed to the intimate contact of FeF₃ nanoparticles with reduced graphene oxide carbon surrounding. Using a combination of in situ XRD, XAS and ex situ Mössbauer spectroscopy, we show that during discharge of HTB-FeF₃/rGO composite Li is intercalated fast into the tunnels of the HTB-FeF₃ structure up to x = 0.92 Li. The Li intercalation is followed by slow conversion of HTB-Li_xFeF₃ to LiF and Fe nanoparticles below 2.0 V. During charge, the LiF and Fe phases are slowly transformed to amorphous FeF₂ and FeF₃ phases without reformation of the HTB-FeF₃ framework structure. At an elevated temperature of 55 °C a much higher specific energy of 780 Wh kg⁻¹ was obtained.