The application of light-emitting diode (LED) in agriculture and bio-industry has been concerned by all over the world along with the development of LED technology. LED not only has many advantages, such as small size, long life, low energy consumption, securing wavelength and low production of heat, but also can emit the exact spectrum based on the need of plant. LED can actualize a lot of functions, such as energy-saving, environment-protection and efficient space utilization, which can not be achieved by conventional light source. This paper expounds in detail the application of LED in agriculture and bio-industry, with emphasis on the characteristics of LED and the progress on its application in plant cultivation, tissue culture, plant factory and controlled ecological life supporting system (CELSS). It also analyzes and prospects the trends of LED applied in artificial lighting, plant factory, CELSS and the combination with new energy sources.