This work reports on the moisture inducing delamination in light-emitting diode (LED) packages and its effects on thermal characteristics. The LED samples were subjected to moisture preconditioning followed by heat block testing. Transient thermal measurements were performed to investigate the thermal behavior of the delaminated LEDs. Increase of thermal resistance with the degree of delamination was observed from the transient measurement. The thermo-mechanical calculated from coupled-field FEA simulation agree well with the micrographical evidence. The calculated hygro-mechanical stress increased with the preconditioning time. It was found that the thermo-mechanical stress plays more important role than the hygro-mechanical stress for the development of delamination in the LED packages. Moisture preconditioning for 3 hrs and 6 hrs under 85°C/85RH conditions was found to make little contribution to the delamination between the chip and lead frame.