Lithium-ion batteries have developed into a popular energy storage choice for a wide range of applications because of their superior characteristics in comparison to other energy storage technologies. Besides modelling the performance behavior of Lithium-ion batteries, it has become of huge interest to accurately diagnose their state-of-health (SOH). At present, Lithium-ion batteries are diagnosed by performing capacity or resistance (current pulse) measurements; however, in the majority of the cases, these measurements are time consuming and result in changing the state of the battery as well. This paper investigates the use of the electrochemical impedance spectroscopy (EIS) technique for SOH diagnosis of Lithium-ion battery cells, instead of using the aforementioned techniques, since this new method allows for online and direct measurement of the battery cell response in any working point. For the investigation, a 2.5 Ah Lithium-ion battery cell based on lithium iron phosphate and graphite (LiFePO4/C), as active material, was used. The obtained results at different battery SOH levels have been analyzed in detail and are suggesting that the EIS technique represents a promising tool for diagnosis the lithium-ion battery cells' SOH; meaningful results regarding the pulse power capability decrease of the tested Li-ion battery cells were obtained by applying the EIS technique.