First-principles density functional theory calculations are employed to investigate novel ultrathin silicon nanosheets (SiNSs) for their potential application as the anode material for Li-ion batteries. We find that Li has a higher tendency to bind on the surface of SiNS rather than penetrating through inside. The binding energies of Li show a strong dependence on the thickness of the nanosheets. The results suggest that insertion/deinsertion of Li can be controlled by using nanosheets of different thickness. More importantly, we show that there is a large increase of diffusivity in Si nanosheets as compared with the bulk case. In addition, Li diffusion shows strong dependence on the chemical functionalization of SiNSs, in which the diffusion rate is the fastest on H passivated surface as compared with the halogen passivated surfaces. Our results suggest that SiNSs are potential materials for Li-ion battery applications.