The parasitic reactions associated with reduced oxygen species and the difficulty in achieving the high theoretical capacity have been major issues plaguing development of practical nonaqueous Li-O2 batteries. We hereby address the above issues by exploring the synergistic effect of 2,5-di-tert-butyl-1,4-benzoquinone and H2O on the oxygen chemistry in a nonaqueous Li-O2 battery. Water stabilizes the quinone monoanion and dianion, shifting the reduction potentials of the quinone and monoanion to more positive values (vs Li/Li+). When water and the quinone are used together in a (largely) nonaqueous Li-O2 battery, the cell discharge operates via a two-electron oxygen reduction reaction to form Li2O2, with the battery discharge voltage, rate, and capacity all being considerably increased and fewer side reactions being detected. Li2O2 crystals can grow up to 30 μm, more than an order of magnitude larger than cases with the quinone alone or without any additives, suggesting that water is essential to promoting a solution dominated process with the quinone on discharging. The catalytic reduction of O2 by the quinone monoanion is predominantly responsible for the attractive features mentioned above. Water stabilizes the quinone monoanion via hydrogen-bond formation and by coordination of the Li+ ions, and it also helps increase the solvation, concentration, lifetime, and diffusion length of reduced oxygen species that dictate the discharge voltage, rate, and capacity of the battery. When a redox mediator is also used to aid the charging process, a high-power, high energy density, rechargeable Li-O2 battery is obtained.