A light-emitting diode (LED) for both AlGaInP- and GaN-based materials needs a good transparent current spreading layer to disseminate electrons or holes from the electrode to the active layer. The present invention utilizes a conductive and transparent ITO (Indium Tin Oxide) thin film with an ultra-thin (to minimize the absorption) composite metallic layer to serve as a good ohmic contact and current spreading layer. The present invention avoids the Schottky contact due to direct deposition of ITO on the semiconductor. For AlGaInP materials, a thick GaP current spreading layer is omitted by the present invention. For GaN-based LEDs with the present invention, semi-transparent Ni/Au contact layer is avoided. Therefore, the light extraction of LED can be dramatically improved by the present invention. Holes may be etched into the semiconductor cladding layer forming a Photonic Band Gap structure to improve LED light extraction.