Japan-born Nakamura, 52, was given the award for "inventing new and elementary lights sources," the Millennium Prize Foundation's chairman Jaakko Ihamuotila said.
The prize was awarded for the second time since it was established in 2002. Two years ago, it was given to Tim Berners-Lee, the MIT scientist credited with inventing the World Wide Web, the AP reports.
The announcement came at a ceremony in Espoo, just outside the Finnish capital.
For this year's prize, the international selection committee studied 109 nominations from 32 countries, Ihamuotila said.
LED lights, that have long lives and consume far less energy than normal incandescent lamps, "could achieve very significant reductions in energy consumption in future decades," the committee said, adding that Nakamura's inventions could also be used for the sterilization of drinking water by using ultraviolet LED lighting.