Layered perovskites have been shown to improve the stability of perovskite solar cells while its operation mechanism remains unclear. Here we investigate the process for the conversion of light to electrical current in high performance layered perovskite solar cells by examining its real morphology. The layered perovskite films in this study are found to be a mixture of layered and three dimensional (3D)-like phases with phase separations at micrometer and nanometer scale in both vertical and lateral directions. This phase separation is explained by the surface initiated crystallization process and the competition of the crystallization between 3D-like and layered perovskites. We further propose that the working mechanisms of the layered perovskite solar cells involve energy transfer from layered to 3D-like perovskite network. The impact of morphology on efficiency and stability of the hot-cast layered perovskite solar cells are also discussed to provide guidelines for the future improvement.