Ball-milled graphitic carbon, both not and electrochemically lithiated, has been studied by total x-ray diffraction involving high-energy synchrotron radiation scattering and atomic pair distribution function analysis. The experimental data has been used to guide reverse Monte Carlo simulations of the three-dimensional structure of the not-lithiated samples. Experimental and modeling results show that ball milling for short times breaks the graphitic layers into smaller pieces as well as generates extended atomic vacancies. Those increase the overall ability of the material to accommodate lithium. Ball milling for longer times keeps generating even more atomic vacancies in the graphitic layers. Carbon atoms displaced from the layers, however, move in between the layers, turning heavily ball-milled graphitic carbon into an assembly of almost-fused-together, heavily buckled layers that have an impaired ability to accommodate Li atoms. This helps explain well the initial substantial increase and then decrease in the Li storage capacity of ball-milled graphitic carbon. The study demonstrates the great ability of total x-ray diffraction to provide precise structural information for complex materials that are being increasingly explored for energy applications.