We investigate the effect of InGaN stress compensation layer on the properties of light emitting diodes based on InGaN/GaN multiple quantum well (MQW) structures with stepgraded electron injectors. Insertion of an InGaN stress compensation layer between n-GaN and the step graded electron injector provides, among others, strain reduction in the MQW region and as a result improves epitaxial quality that can be observed by 15-fold decrease of V-pit density. We observed more uniform distribution of In between quantum wells in MQW region from results of electro-and photoluminescence measurement. These structural improvements lead to increasing of radiant intensity by a factor of 1.7e2.0 and enhancement of LED efficiency by 40%.