LED-ID (Light Emitting Diode-Identification) network is envisioned to be the next generation indoor wireless communication medium by which simultaneously high speed data transmission, identification, and illumination are possible. In spite of being extremely promising, it suffers from much impairment. Signals having different propagation paths can suffer from delays, and phase shifts which will eventually result interference. The probability of interference is also increased when communication links are established between a tag and several readers. Therefore it is necessary to reduce the interference in LED-ID network to ensure quality of service. It is possible to avoid interference by knowing the information about readers prior to assign the available spectrum. In this paper, we have proposed dynamic spectrum decision using cognitive radio concept. The simulation results justify that the proposed scheme is better than the conventional scheme.