In this paper we propose a promising die-bonding material consisted of diamond-added AgSnCu solders for chip package, and combine it with our well-established cup-shaped copper technique for chip heat dissipation. The composite solder was prepared by mixing the commercial Sn-3wt.%Ag- 0.5wt.%Cu (SAC305) solder paste with the diamond paste [0.25(W)475-MA, Engis, USA] in a weight ratio of 10:1. Thermal resistance analysis shows that total thermal resistance of the LED packaged using the composite solder is only 6.4 K/W, which is much lower than both the LED using AgSnCu solder (9.2 K/W) and the LED using silver paste (10.4 K/W). As a result, the LED with the composite solder exhibits larger light output power and smaller junction temperature than the other two samples. The improved device performance is mainly due to enhanced heat dissipation of the die-bonding materials used. These results suggest that the composite diamond-added AgSnCu solder is promising in high-power LED application.