Si‐based high capacity anodes are of the utmost importance for advancing energy density of lithium‐ion batteries. The major shortcoming of Si‐based anodes, however, is their poor cycle performance. To solve this problem, it is essential to understand the failure mechanisms of both the Si‐based anodes. In this work, we observe the cycle‐dependent microstructural evolution of a SiC composite/graphite‐blended electrode using ex situ scanning electron microscopy observations and corresponding cross‐sectional elemental mapping images. We reveal that the Si particles become finer and spread through the whole electrode and act as an electrochemically active site for electrolyte decomposition reactions. This forms a solid electrolyte interphase layer on the surface of the Si particles during cycling. The resulting electrolyte decomposition products surrounding the Si particles are finely spread throughout the whole blended electrode. This cycle‐dependent microstructural change is one of the main reasons for the poor capacity retention of the blended electrode. [ABSTRACT FROM AUTHOR]