Lithium iodides are very efficient single-crystal scintillators for thermal neutron detection. Doping with silver, as activator ions, has shown to improve its limitation of discriminating gamma background by introducing pulse shape discrimination ability. To improve the scintillation performance, single crystals of LiI: Ag, codoped with different concentration of Sr ions, are grown and characterized in details. A systematic investigation of radioluminescence, thermoluminescence, and scintillation properties along with the decay kinetics provides better understanding about the role of defect structure in scintillation mechanism. The extra charge, provided by Sr²⁺ ions, is found to alter the defect structure with relative reduction of the contribution from the deeper trap centers in comparison with the shallow traps. Consequently, it leads to a significant improvement of light yield quenching under higher excitation density of charged particle irradiation. The 0.1% Sr codoped crystals provide a better discrimination ability of neutron and gamma radiations for simultaneous detection.