The light emitting diode (l.e.d.) is a source widely used as indicator lamp, and in displays. The output covers a narrow spectral band which is defined by the material and dopants used. At present red, orange, yellow and green emitting devices are commercially available. The l.e.d. has many of the expected attributes of semiconductor devices including long life, small size, low operating voltages, ruggedness and low cost, but unfortunately it is extremely inefficient. This paper discusses the reasons for this and reviews the performance of devices made from currently available materials in terms of what is fundamentally possible and the present day limitations of device technology. Developments which are likely to occur in the near future are considered, and the potential of alternative materials discussed.