Li-ion battery electrode materials that undergo huge volume changes require studies on fracturing during lithiation. By analyzing the process of lithiation, a new model has been established, which considers the dislocation mechanisms of nanostructured thin film electrode materials involving diffusion induced stress to improve the battery life of Li-ion batteries undergoing potentiostatic or galvanostatic charging. In the present work, the interactions between diffusion and dislocation induced stress or strain energy are demonstrated under potentiostatic and galvanostatic charging. The stress and strain energy can evolve quite differently under potentiostatic or galvanostatic charging. At the same time, we observed that the magnitude of the stress and strain energy is influenced by dislocations. What’s more, the effect of dislocations on the total strain energy or maximum stress is larger under potentiostatic charging than under galvanostatic charging at the beginning of charging. However, the total strain energy or maximum stress under galvanostatic charging is larger than that under potentiostatic charging later in the lithiation process. The influence of the dislocation effects upon the mechanical behaviour is specified, and is more significant in terms of the distribution of the stress and strain energy in the nanostructured thin film electrode. These results also show that it is possible to control the dislocation density with the methods of nanotechnology to improve Li-ion battery life.