GaN-based light-emitting diodes (LEDs) grown on sapphire substrate have current transport along the lateral direction due to the insulating nature of the substrate, and the anode and cathode contacts are in a side-by-side configuration. The resistance of the n-type material of the GaN and the lower confinement layer is not negligible, which causes the current to crowd near the edge of the n-contact pad. The current crowding problems will become more severe for large area and high power devices. In this paper, the current spreading effect is qualitatively analyzed. The applied current density and the effective length of the lateral current transport are found to have a considerable effect on the uniform current spreading. Based on these findings, an optimized contact scheme of high-power GaN-based LEDs is proposed to alleviate current crowding effect and reduce the series resistance of the devices. It is clearly shown that the high-power GaN-based flip-chip LEDs with optimized ring-shape interdigitated contact scheme have a relatively uniform temperature distribution by measuring the surface temperature distribution of the device with infrared thermal imaging system. It is confirmed that the current distributes more uniformly over the contact, and current densities in a localized region of the device are reduced, which can decrease the joule heat generated and improve the reliability of the GaN-based LED.