In this paper Distribution of Relaxation Times (DRT) method is introduced for analyzing aging and failure conditions in lithium-ion (Li-ion) batteries, addressing challenges associated with its implementation. While Electrochemical Impedance Spectroscopy (EIS) and Equivalent Circuit Models (ECM) are commonly used to monitor battery performance, their interpretation is often complicated by overlapping semicircles in impedance spectra. The DRT technique resolves this issue by deconvolving relaxation times, enabling the separation of individual electrochemical processes and providing a clearer understanding of aging and failure conditions. The peaks of lower frequency components in DRT plots, specifically the charge transfer and diffusion processes, are key indicators of the battery failure point. When these two processes merge, it signals that the battery can no longer function, marking a critical failure point in Li-ion batteries. Identifying failure conditions and aging in Li-ion batteries using DRT offers a more advanced approach compared to ECM, as it delivers greater detail in the electrochemical processes that contribute to performance degradation. The analysis of two kinds of different Lithium-Ion battery cells based on the DRT reveals the specific aging and failure patterns, particularly in later battery life stages. The findings demonstrate the potential of DRT as a real-time indicator to monitor the status and the lifecycle of the battery.