Understanding how lithium-ion dynamics affect the (de)lithiation mechanisms of state-of-the-art nickel-rich layered oxide cathodes is crucial to improving electrochemical performance. Here, we directly observe two distinct kinetically-induced lithium heterogeneities within single-crystal LiNixMnyCo(1-x-y)O2 (NMC) particles using recently developed operando optical microscopy, challenging the notion that uniform (de)lithiation occurs within individual particles. Upon delithiation, a rapid increase in lithium diffusivity at the beginning of charge results in particles with lithium-poor peripheries and lithium-rich cores. The slow ion diffusion at near-full lithiation states – and slow charge transfer kinetics – also leads to heterogeneity at the end of discharge, with a lithium-rich surface preventing complete lithiation. Finite-element modelling confirms that concentration-dependent diffusivity is necessary to reproduce these phenomena. Our results show that diffusion limitations cause first-cycle capacity losses in Ni-rich cathodes.