An LCD according to the present invention includes lower and upper panels facing each other and a liquid crystal layer interposed therebetween. The upper panel includes a black matrix formed on an inner surface of an insulating substrate, having openings corresponding to pixel areas, and blocking the light leakage between the pixel areas, a plurality of red, green, and blue color filter sequentially arranged in the pixel regions, a flat layer formed on the red, green and blue color filters, and a common electrode formed on the flat layer, made of transparent conductive material such as ITO (indium tin oxide) or IZO (indium zinc oxide), and supplied with a predetermined voltage for driving the liquid molecules in cooperation with the pixel electrodes. In addition, a light diffraction layer having micro structure of slit pattern or diffraction lattice is formed between the black matrix and the red, green, or blue color filters. The light diffraction layer is made of transparent conductive material such as ITO or IZO or transparent insulating material such as silicon nitride or silicon oxide. The gap between the slits or width of slits of the light diffraction layer is preferably equal to or less than seven microns and it is possible to have two or more different widths or gaps in the range of equal to or less than 7 microns.