Chemistry: A Molecular Approach (3rd Edition)

This is a redox reaction. Li acts as a reducing agent and $O_{2}$ acts as an oxidizing agent.
In a redox reaction, there is a change in oxidation number. Li's oxidation number changes from 0 to +2. Since there is an increase in the oxidation number, it gets oxidized. Hence, it acts as a reducing agent. $O_{2}$'s oxidation number changes from 0 to -2 which shows that there is a decrease in the oxidation number. This means that $O_{2}$ gets reduced. Hence, it acts as an oxidizing agent.