LED stands for light-emitting diode. A diode is an electronic component that allows current to flow only in one direction. LEDs produce light as current passes through them. The light they produce can be used as an indicator or used to provide other forms of information. An LED switch has an LED inside of the switch. Depending on how the LED is wired, the LED could be on all the time regardless of whether the switch is on or off. The other option is for the LED to be on only when the switch is on.
Identify all of the connections on the LED switch. An LED switch usually has three connections--two power connections and one common connection. The two power connection are connected to the positive and negative sides of the power source. The common connection is connected to one side of the device power is being supplied to. The other side of the device receiving power will be connected to the negative side of the power supply.
Connect the negative wire from the power source to the negative side of the switch. Connect the positive side of the power source to the positive side of the switch. Connect the common side of the switch to the positive side of the device and connect the negative side of the device to the negative side of the power supply.
Test the switch's operation. In this configuration, the LED will be on only when the switch is on. If the connections for the positive side of the switch and the common connections are reversed, the LED will stay on all of the time regardless of the switch position.