An optical element includes a light guide plate, a reflector received in a mounting hole of the light guide plate, and a supporting rod secured to and extending upwardly from the reflector. The light guide plate defines the mounting hole extending through the light guide plate from a top face to a bottom face thereof. The reflector includes a mounting surface coplanar with the top face of the light guide plate and a tapered reflecting face extending slantwise downwardly and inwardly from the mounting surface thereof. A backlight module incorporating the optical element is also provided. The backlight module has an LED located in the mounting hole and faces the reflecting face, and a diffuser plate secured to a top end of the supporting rod.