A display apparatus and a brightness adjusting method thereof are provided. The display apparatus includes a panel unit which displays an image signal, a backlight unit which provides a light to the panel unit to visualize the image signal, a luminance value regulator which calculates representative values to be applied for adjusting a brightness of a plurality of partial areas of the backlight unit corresponding to the input image signal, a contrast enhancer which compensates for a brightness of the image signal compromised by the representative value through a contrast enhancement, and a pixel value compensator which compensates for pixel values of the image signal compensated using the contrast enhancement. Accordingly, the contrast ratio of the entire image can be enhanced by compensating for the brightness loss of the image signal caused from the brightness adjustment of the luminous element, and the image quality can be more finely improved.