In this paper we present the thermal and mechanical analysis of high-power light-emitting diodes (LEDs) with ceramic packages. Transient thermal measurements and thermo-mechanical simulation were performed to study the thermal and mechanical characteristics of ceramic packages. Thermal resistance from the junction to the ambient was decreased from 76.1°CAV to 45.3°CAV by replacing plastic mould to ceramic mould for LED packages. Higher level of thermo-mechanical stresses in the chip were found for LEDs with ceramic packages despite of less mismatching coefficients of thermal expansion comparing with plastic packages. The results suggest that the thermal performance of LEDs can be improved by using ceramic packages, but the mounting process of the high power LEDs with ceramic packages is critically important and should be in charge of delaminating interface layers in the packages.