Safety remains a critical technological barrier for Lithium-ion batteries. Besides safer battery materials, intelligent battery management can be the key to safer batteries. Motivated by this scenario, we propose an active fault tolerant control scheme which can potentially improve battery safety. Essentially, we focus on battery internal thermal faults which may lead to thermal runaway, and design a control scheme to alleviate such fault effect at an early stage. The control scheme consists of a fault tolerant control algorithm coupled with a fault and state co-estimator. A multi-objective optimal control technique has been used to design the control algorithm whereas an unknown state-input co-estimation approach is used for the fault and state estimator. Finally, simulation studies illustrate the effectiveness of the proposed control scheme.