LiBH has excellent application potential as an off- or on-board hydrogen carrier for its unparalleled hydrogen capacity (18.5 wt%). However, the difficulty in recycling "one-pass" LiBH and the resulting high cost hamper its large-scale applications. Here, we report a facile and low-cost method for LiBH regeneration by ball milling its hydrolysis by-product (LiBO·2HO) and Mg under ambient conditions, where expensive H stored in LiBH is entirely converted from cheap H in coordinated water. This scenario is reported for the first time without hydrides employed as hydrogen sources for the reduction process. Moreover, the yields for LiBH synthesized by this method may reach 40%. The cost of LiBH regeneration exhibits a 5-fold reduction over a previous study using NaBH as a raw material. Significantly, the as-purified product displays even better physicochemical properties than commercial LiBH, for example, superior hydrolysis kinetics. Overall, a one-step approach, combining hydrogen production and storage in a closed cycle, is proposed in this work. Furthermore, the formation mechanism of LiBH is illustrated and the intermediate product, LiBH(OH), is successfully observed for the first time during the regeneration course.