The ferrite nanoparticles of Li0.5Fe2.5O4 spinel ferrite was synthesized by sol-gel auto-combustion technique using the nitrates of the respective cations at low temperature with a final pH 8. A part of as prepared powder was sintered at 700 degrees C for 6 h and treated as the precursor for the gamma irradiation study. The damage investigations were evaluated on the basis of X-ray diffraction and SEM techniques. The X-ray diffraction data was used to investigate the phase purity and structural properties of the synthesized lithium ferrite. The lattice constant of studied samples were increased whereas crystallite size and grain size decreased after gamma irradiation.