A backlight unit for LCD displays including an optical waveguide having a light mixing area and a light extraction area, a flexible side-emitting LED strip incorporating a flexible printed circuit, a reflective layer positioning on a side of the waveguide, and an opaque housing incorporating a heat conductive element and covering two or more sides of the LED strip and at least a substantial portion of the light mixing area. The light extraction area has a two-dimensional pattern light extraction microstructures formed in a surface of the waveguide. The light-emitting surface of LED packages is oriented perpendicular to a major surface of the flexible printed circuit and has a first dimension which is greater than the thickness of the waveguide. The LED strip may be directly or indirectly attached or bonded to a front or back surface of the waveguide.