The scope of this review paper is to consolidate various thermal factors which affect the performance of high power LEDs and also to summarize various cooling methods which improve both the efficiency and lifetime of LED lamps. Thermal factors such as thermal resistance, thermal spreading resistance, thermal interface material, thermal capacitance, active and passive cooling systems suitable for high power LED packages are discussed. The effect of junction temperature on the colour of emitted light and life of LED is also explored. Junction temperature of the LED depends on the current supplied and type of cooling system used. Higher junction temperature with poor cooling leads to shift in the light colour and drastically reduces the LED life. From the review it was found that heat sink and heat pipes are best solution for heat dissipation and in some applications active cooling systems using electric fan provided best results for LED lamps. © 2016 Eastern Macedonia and Thrace Institute of Technology. All rights reserved.