In this paper, taking stability and cost in consideration, a high-power fiber-coupled Light Emitting Diode (LED), instead of a Laser Diode (LD), was adopted as the light source in the measurement of the straightness errors. The calibration experiment showed that the standard deviation was 0.36μm and 0.34μm in X and Y directions, respectively, and the maximum residual was about 0.7μm in X direction and less than 0.5μm in Y direction. The stability experiment indicated that the standard deviation of the position of spot on the detector was 0.246μm in X direction and 0.256μm in Y direction in 30 minutes, respectively. The repeatability experiment was performed by straightness measurement of the linear guide for three times. For one LED with the wavelength of 490nm, the maximum deviation was ±0.9μm in X direction and ±1.4μm in Y direction respectively. For another LED with the wavelength of 565nm, the maximum deviation was ±0.85μm in X direction and ±0.7μm in Y direction. In a conclusion, the system using a LED possesses good stability and repeatability within a limited measurement range, thus proving the feasibility and novelty of the adoption of the LED in collimation measurement, which presents a new approach to enhance the measurement accuracy.