LCD TV back-lighting
Unlike CRT or Plasma TVs, LCD TVs use two forms of backlighting viz, (a) Fluorescent backlight or (b) LED backlight. A liquid Crystal display normally uses fluorescent tube backlight which is diffused by a specially made white panel for uniform brightness of the incident light. This light is provided by number of cold cathode fluorescent lamps (CCFL) normally a few millimeters in diameter.
What is LED and how it works
However Light Emitting Diodes (LED) is being used as backlighting source in large number of LCD TVs. A light emitting diode is a p-n junction semiconductor that produces photons in the visible region when a forward voltage is applied. The voltage so applied causes electrons to cross the junction from the n- to the p-type material, in the electron-hole recombination process. An exposed semiconductor surface then emits light and the phenomenon is known as electroluminescence. The emission of a photon in the extreme red region of the visible spectrum requires an energy release of 1.77 electron-volts (eV) and that for violate on the other extremity requires 3.1 eV. A particular color of the LED can be chosen by suitable choice of semiconductor material and the manufacturing technology.
As LEDs are microscopic, these require very low electrical energy to emit light photons and are thus used as an uniform source of backlighting in energy efficient and high definition LED displays including LCD TV backlighting in place of fluorescent backlighting. Because of the very thin size of LED film, the LED TVs are extremely thin, may be as thin as one inch. Of course this entails additional costs and therefore the LCD TVs with LED backlighting are much costlier to LCD TVs with CCFL backlighting. Again LCD TVs with TFT transistors (active matrix formation) are costlier to LCD TVs with electrode matrix (also called passive matrix).
Therefore if you have a good purse, the best to choose is an LCD TV with TFT as well as LED combinations. This would give you a high definition image with low energy costs. In between you have scores of combinations to suit your budget, depending on technology employed as described above as well as TV sizes.
One thing is also clear from the above discussion that LED TV is a misnomer and in fact LED TV is simply an LCD TV with LED back lighting system incorporated.